01 - Combine warm milk, sugar, and yeast in a small bowl. Let stand for 5-10 minutes until foamy.
02 - Whisk flour and salt in a large mixing bowl. Add yeast mixture, egg, melted butter, and vanilla extract. Mix until sticky dough forms.
03 - Knead dough on lightly floured surface for 5 minutes until smooth and elastic. Place in greased bowl, cover, and let rise in warm place for 1-1.5 hours until doubled.
04 - Turn dough onto floured surface. Roll to 1/2-inch thickness. Cut into 2 1/2-inch squares using sharp knife or pizza cutter.
05 - Heat vegetable oil in deep pot or fryer to 350°F.
06 - Fry 3-4 beignets at a time for 2-3 minutes per side, turning once, until puffed and golden brown.
07 - Remove with slotted spoon and drain on paper towels. Generously dust with powdered sugar while warm.