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Preheat oven to 350 degrees F (175 degrees C).
Butter an 8x4 inch loaf pan, line the bottom and two sides of the pan with the parchment paper.
In a mixing bowl, beat together butter, 1 cup sugar, eggs, and vanilla extract.
In a separate bowl, combine flour, baking powder and salt; stir into egg mixture alternately with milk.
In the same bowl where you combined flour, add blueberries and toss them in 2 tablespoons of flour. This will help prevent blueberries from sinking.
Fold in lemon zest, and blueberries into the batter. Do it carefully and fast. Pour the lemon bread batter into prepared pan.
Bake in preheated oven for about 50-60 minutes, until a toothpick inserted into center of the loaf comes out clean. Cool bread in pan for 40 minutes on a wire rack. Release the bread from the pan.
Combine freshly squeezed lemon juice and 1/2 cup powdered sugar in a small bowl and beat, using electrical mixer, until smooth glaze forms .
Drizzle the top of the blueberry lemon bread (after it's been completely cooled) with the glaze. Some of the glaze will go down the sides of the bread.