Prepare workspace: Line a baking sheet or large plate with wax paper.
Mix Cool Whip: In a large bowl, combine the thawed Cool Whip, powdered sugar, and vanilla extract. If desired, add a few drops of food coloring and mix until well combined.
Shape candies: Using a small scoop or spoon, drop rounded mounds of the Cool Whip mixture onto the prepared wax paper.
Decorate: Immediately sprinkle the candies with colorful sprinkles.
Chill: Place the baking sheet in the refrigerator for at least 2 hours, or until the candies are firm.
Serve: Once chilled, the candies are ready to be enjoyed! Store them in an airtight container in the refrigerator.