In a mixing bowl stir together peanut butter and butter. Gradually add powdered sugar, stirring until combined. Shape into 1-inch balls; place on waxed paper. Let stand until dry (about 20 minutes).
Chop candy coating. Place in a heavy saucepan, cook and stir over low heat until melted and smooth. Cool slightly. Dip balls, one at a time, into coating. Let excess coating drip off peanut butter balls. Place on waxed paper; let stand until coating is firm. Store tightly covered in refrigerator.
** Chocolate can also be melted in microwave.
** Make-Ahead Tip: Prepare candy & store in fridge for up to 2 weeks.