PREHEAT oven to 350° F. Grease 13 x 9-inch baking dish.
PLACE bread cubes in prepared baking dish. Sprinkle morsels over bread. Beat eggs in large bowl. Stir in milk, Nesquik, sugar and vanilla extract; pour over bread mixture.
BAKE for 60 to 65 minutes or until knife inserted near center comes out clean. Cool slightly. Sprinkle with powdered sugar before serving.