Pick fresh dandelions from an untreated area. Remove the yellow petals from the green bases, keeping only the soft petals to avoid bitterness.
Place the petals in a saucepan and pour in the water. Bring to a gentle simmer, then remove from heat and cover. Let the mixture steep for 30 minutes to extract the floral flavor.
Pour the steeped mixture through a fine mesh strainer or cheesecloth into a bowl, pressing lightly on the petals to release all the liquid. You should have about 3 cups of golden dandelion tea.
Pour the strained tea into a large pot. Stir in the lemon juice, lemon zest, and powdered pectin. Bring the mixture to a rolling boil over medium-high heat, stirring constantly.
Add the sugar all at once and continue stirring. Bring the mixture back to a full boil that cannot be stirred down. Boil for 1 minute.
Remove from heat and stir in the vanilla extract if using. Skim off any foam from the surface.
Carefully ladle the hot jelly into sterilized jars, leaving about ¼ inch headspace.
Wipe jar rims clean, add lids, and process in a boiling water bath for 10 minutes to seal.
Allow jars to cool completely at room temperature. The jelly will set as it cools, forming a clear golden spread with a light floral flavor.