In a medium saucepan over medium heat, combine the water, softened butter, granulated sugar, vanilla extract, and salt. Stir until the mixture comes to a gentle boil.
Once boiling, remove the saucepan from the heat. Immediately add the all-purpose flour and stir vigorously with a wooden spoon until the dough forms a ball and pulls away from the sides of the pan.
Allow the dough to cool for about 5 minutes. Then, add the eggs one at a time, mixing well after each addition until the dough is smooth and glossy.
Preheat your air fryer to 375°F (190°C) while you prepare the churros.
Transfer the dough to a piping bag fitted with a star tip. Line a baking sheet with parchment paper. Pipe long strips of dough onto the parchment, about 6 inches in length.
Brush the churros lightly with melted butter before placing them in the air fryer.
Place the churros in the air fryer basket in a single layer, making sure not to overcrowd them. Air fry for 10-12 minutes or until golden brown and crispy, turning them halfway through for even cooking.
While the churros are cooking, mix the granulated sugar and cinnamon in a shallow bowl. Once the churros are done, remove them from the air fryer and immediately coat them in the cinnamon-sugar mixture.