Peel, seed and slice the fresh peaches.
In a large glass bowl, add the peaches, lemon juice and sugar. Mash together with a potato masher... you will still have some small chunks of fresh peaches with the juice.
Scrape the vanilla bean into the bowl and mix well. Let stand for about 10 minutes.
In a small sauce pan, mix together the SURE-JELL and water. Heat over high and boil the mixture for 1 minute.
Add the SURE-JELL mixture to the peach mixture and stir constantly for 3 minutes.
Ladle the peach jam into clean 1-cup jars (I used Ball freezer jars). Freeze until ready to use.