Heat oven to 350°. Grease and flour a 9 x 5 x 3-inch loaf pan.
In a large bowl, mix together butter, sugar and lemon extract. Beat in eggs with an electric mixer.
In a separate bowl, sift together flour, baking powder and salt. Add flour mixture to butter mixture, alternating with milk, beating just enough to blend. Fold in lemon rind and pour into prepared loaf pan.
Bake at 350° for 1 hour , until toothpick inserted into center comes out clean. Cool 10 minutes and remove from pan.
Mix together lemon juice and sugar. While bread is still hot, pour icing over top and into any cracks (place loaf over a sheet pan, as extra icing will drip over sides). When loaf is cool, wrap tightly in foil and store overnight before serving.