Beat 1 cup butter and 1 1/2 cups powdered sugar at medium speed with a heavy-duty electric stand mixer 2 minutes or until pale and fluffy. Beat in 1/4 tsp. vanilla extract. Gradually add flour mixture, beating at low speed 30 seconds after each addition until a dough forms and comes together to hold a shape.
Press 2 cups of dough in a thick layer onto bottom of a lightly greased 13- x 9-inch pan. Top evenly with fresh blueberries. Combine granulated sugar and lime rind, and sprinkle evenly over berries. Crumble remaining dough evenly over berries.
Bake at 350° for 45 to 50 minutes or until golden. Cool shortbread in pan on a wire rack 2 hours. Cut into squares before serving.