In a bowl, cut the butter into the flour until crumbly; stir in 1/2 cup pecans. Press into an ungreased 13-in. x 9-in. x 2-in. baking pan. Bake at 350° for 20 minutes or until lightly browned. Cool.
In a mixing bowl, beat cream cheese and sugar until fluffy. Fold in 1 cup whipped topping; spread over crust. Combine milk and pudding mix until smooth; pour over cream cheese layer. Refrigerate for 15-20 minutes or until set. Top with remaining whipped topping and pecans. Refrigerate for 1-2 hours.