Preheat your oven to 350°F (175°C) and line two baking sheets with parchment paper.

In a large mixing bowl, beat together the softened cream cheese and unsalted butter until smooth and creamy, about 2-3 minutes.

Add in the large egg and vanilla extract, mixing well until fully incorporated.

Gradually stir in the yellow cake mix until a thick dough forms, ensuring no dry mix is visible.

Gently fold in the holiday sprinkles with a spatula.

Cover the bowl with plastic wrap and chill the dough in the refrigerator for at least 30 minutes.

Scoop out 1½-inch balls of dough and roll each ball in powdered sugar until fully coated.

Place the cookie dough balls on the prepared baking sheets, spacing them about 2 inches apart.

Bake the cookies for 10-12 minutes until the edges are set but the centers remain soft.

Let the cookies cool on the baking sheets for a few minutes before transferring them to a wire rack.