Preheat oven to 375F. Line a 12 count muffin pan with liners, and spray with non stick spray. Set aside.
In a medium sized bowl, combine the flour, baking powder and salt. Set aside. In a large bowl or stand mixer, beat the sugar and butter until light and fluffy. Add the vanilla extract, milk and egg, mixing until fully combined.
Gradually add the dry ingredients to the wet ingredients and mix until combined. Be careful not to over-mix!
Fill the muffin tin 2/3 full and bake for 20-22 minutes or until a toothpick in the center comes out clean and the tops are lightly golden brown.
Remove from the oven and let completely cool on a cooling rack before piping the icing on them.
While the cupcakes are cooling, beat the softened butter until pale and fluffy. Carefully add in the powdered sugar, vanilla and milk and mix until smooth. Add green food coloring until your desired color is reached.
Place In a ziplock bag or piping bag and pipe on completely cooled cupcakes.
Place a toothpick in the center of the marshmallow peeps and place on top of the frosted cupcakes. Decorate with your favorite Easter egg candy and enjoy!