Set your oven to 350°F (175°C). Line a baking sheet with parchment paper.
In a large bowl, beat softened butter and granulated sugar for 2–3 minutes until light and fluffy.
Mix in the egg and vanilla extract until smooth and well combined.
In another bowl, whisk together flour, flavored gelatin, baking powder, and a pinch of salt.
Gradually mix the dry ingredients into the wet mixture until a soft dough forms. If it feels sticky, chill for 15 minutes.
Roll tablespoon-sized scoops of dough into balls. Place them 2 inches apart on the baking sheet and gently flatten. Add sprinkles if desired.
Bake for 8–10 minutes until edges are set but centers are still soft. Avoid overbaking.
Let cookies cool on the baking sheet for 5 minutes, then transfer to a wire rack. Once fully cooled, decorate with royal icing or extra sprinkles.