Line square baking dish (8x8" or 9x9") with aluminum foil. Spray the foil with cooking spray.
Add butter, sweetened condensed milk, and peanut butter to a medium saucepan over medium heat. Stir occasionally for a few minutes until butter is melted.
Stir in the marshmallows until they melt - another minute or so.
Stir in the chocolate chips until they melt - just another minute or two. Remove from heat.
Pour the fudge mixture into prepared pan, ensuring you get it to spread as evenly as you can across the pan. (It's not going to be very runny, so don't worry about trying to fit every nook and cranny. Gravity will eventually help it settle!)
Immediately sprinkle chopped peanuts on top and gently press in.
Chill in fridge for 3-4 hours (or overnight). Remove pan from fridge, lift fudge out with foil, and then use a sharp knife to slice fudge into about 32 smaller pieces. You can make fewer cuts than this to produce larger pieces of fudge, but because this is such a decadent and sweet treat, I like to make smaller pieces.
Wrap fudge block tightly with plastic wrap or store in an airtight container in the fridge for several days. It'll stay moist & delicious for quite a while!