Preheat the oven to 350º.
Beat together the butter and sugar until light and fluffy. add the vanilla and walnuts. Add the 2 cups of flour and combine. Break off 1 Tablespoon sized pieces and shape into crescents and place on a baking sheet. Bake for about 13-15 minutes, or until the cookies are set, and golden brown. Cool completely, and then roll into the powdered sugar until well coated. Store in airtight containers