Place the butterscotch chips, marshmallows, and milk in a large microwavable bowl. Heat on high for 30-second intervals for 3 minutes. Stir between each interval until melted.
Stir in the peanut butter and vanilla and mix well. Stir in the peanuts until they are well distributed. Pour the mixture into the prepared baking dish. Place a sheet of parchment paper over it and press with your hand or the back of a spoon to flatten it. When the fudge is smooth on top, cover it and place it into the refrigerator for at least 4 hours to chill. Cut into 60 squares.
Notes
Substitute Butterscotch Chips
You can substitute an equal amount of high-quality butterscotch chips for the peanut butter chips. This will vary the taste a little, but the fudge will still be delicious.
Yield
This recipe makes about 64 one-inch cubes.
Alternative Preparation Method
This recipe can also be made in a heavy saucepan on the stovetop using low to medium heat. First, melt the peanut butter chips and marshmallows with condensed milk, stirring often. When completely melted, pick up the recipe at the beginning of Instruction 3 (adding peanut butter) to finish.