Place butter, chocolate chips and vanilla in a mixing bowl. Set aside.
In a medium saucepan over medium heat, combine sugar, milk and marshmallows. Bring to a boil, stirring frequently. Reduce heat to low and cook 6 minutes more, stirring constantly.
Remove from heat.
Pour marshmallow mixture over contents of mixing bowl. Beat entire mixture until it thickens and loses its gloss. Quickly fold in nuts and pour into prepared pan. Refrigerate several hours until firm.
