Line an 8-in. square pan with foil and greased the foil with 1 teaspoon butter; set aside. In a large bowl, combine the confectioners' sugar, cocoa and salt. Melt remaining butter; add milk and vanilla. Stir into sugar mixture until blended; whisk until smooth. Stir in M&M's. Immediately spread into prepared pan. Refrigerate until firm, about 2 hours.
Using foil, lift fudge out of pan. Discard foil; cut fudge into 1-in. squares. Store in an airtight container in the refrigerator.