In a large mixing bowl, combine the instant vanilla pudding mix, powdered sugar, milk, and vanilla extract.
Using an electric mixer on medium-high speed, beat the mixture for about 2 minutes until smooth and creamy. The mixture will begin to thicken slightly as the pudding sets.
Step 2: Add the Cool Whip
Add the thawed Cool Whip to the pudding mixture. Beat on medium speed until fully incorporated, creating a light, airy, and fluffy frosting. Scrape down the sides of the bowl as needed to ensure everything mixes evenly.
The frosting should be thick enough to spread but still soft and creamy. If it feels too stiff, add an extra tablespoon of milk to loosen it slightly.
Step 3: Use or Chill
Once combined, your frosting is ready to use. Spread it generously over cakes, cupcakes, or cookies using an offset spatula for a smooth finish.
Alternatively, use it as a dip for fresh fruit such as strawberries, apple slices, or grapes for an easy, crowd-pleasing treat.
If not using immediately, transfer the frosting to an airtight container and refrigerate until ready to serve. It will stay fresh and fluffy for up to 3 days.