Preheat the oven to 350°F (175°C). Grease a 9×9 inch light metal baking pan and line it with parchment paper.
Add the pistachios to a food processor and pulse until finely ground. Set aside for later use.
In a medium bowl, whisk together the all purpose flour, baking powder, baking soda, and salt. Then set aside the flour mixture.
Add the sugar and lemon zest to a large bowl. Rub the lemon zest and sugar together with your fingertips to extract the most lemon flavor from the zest.
Add in the softened butter. Cream the butter, sugar and lemon zest together with an electric mixer on high speed for 1-2 minutes until light and fluffy.
Then add in the eggs and vanilla and mix on medium speed until pale in color and smooth, about 1 minute.
Add the buttermilk and the dry ingredients to the wet ingredients a little at a time, mixing on low speed until the cake batter is combined. Scrape the sides of the bowl with a rubber spatula as necessary.
Fold in the ground pistachios.
Pour the batter into the prepared baking pan.
Bake the cake for 38-42 minutes, or until a toothpick comes out clean from the center.
Let the cake cool in the pan on a wire rack for 30 minutes, then pull up on the parchment paper to release it from the pan. Let the cake continue cooling on the cooling rack until completely cooled.