Bring a large pot of water to a boil. Score an "X" on the bottom of each peach with a small knife. Immerse peaches in boiling water for 30-45 seconds, then transfer immediately to an ice bath. The skins should slip off easily when you apply gentle pressure. Remove pits and chop into ½-inch pieces.
In a large, heavy-bottomed pot, combine the chopped peaches, sugar, and lemon juice. Stir gently until sugar begins to dissolve. Add the vanilla bean and scraped seeds (or extract) and butter.
Bring the mixture to a full rolling boil over medium-high heat, stirring frequently to prevent scorching. Once boiling, reduce heat to medium and continue cooking for 35-45 minutes, stirring occasionally, until the jam reaches your desired consistency.
Test readiness by placing a small amount on a frozen plate—it should wrinkle when pushed with your finger after cooling for 30 seconds.
Remove vanilla bean (if used). Ladle hot jam into sterilized jars, leaving ¼-inch headspace. Wipe jar rims clean, apply lids and bands, and process in a boiling water bath for 10 minutes for long-term preservation.