Place bread cubes in buttered 1 1/2 quart baking dish, set aside. In small saucepan, heat milk, sugar and butter to dissolve. Beat eggs slightly, add salt, stir eggs into warm milk and add vanilla. Pour liquids over bread cubes and set dish in pan of hot water. Bake at 350 degrees for 1 hour.

While pudding bakes, prepare lemon sauce by boiling for 1 minute, sugar, cornstarch, salt, water and lemon peel. Remove from heat and stir in butter and lemon juice.