I made yogurt out of milk for the first time a week or two ago.
I know what you're thinking. All those domestic ideas Austin has are spot on.
You're right. They are.
I would rather make yogurt myself than buy it. It is the best yogurt ever and it only costs me about a dollar a quart this way.
I used the awesome yogotherm he got me for Christmas 2009, but you could use anything that will keep a liquid at a constant temperature for 10-12 hours. The Backyard Homestead (one of my favorite books ever right after the Laura Ingalls Wilder series for home food making instruction) gives several options, my favorite being wide-mouth glass jars in a Styrofoam thermos.
I used a combo of the recipe from Backyard Homestead and Ricki the Cheese Queen's recipe.
I heated 2 quarts of milk to 186 degrees, turned off the heat and stirred in 1/2 cup of dried milk (both make the yogurt thicker and creamier). Then I let it cool to 110 and added 1/2 cup of yogurt I bought at the store (it was Dannon All Natural Nonfat Plain which is tangier than some and I like that, but I think any kind of plain would work), poured the whole thing in the yogotherm, sat it on the counter to work undisturbed and came back 10 hours later to 2 quarts of yogurt. Awesome.
Austin really prefers Greek yogurt which is thicker than most and tangier in my opinion. I already had the tangy part down (you can leave it to set longer to get tangier yogurt). I strained it (in a coffee filter in a sieve over a measuring cup in the fridge letting 1/2 cup of whey drain out of each 2 cups of yogurt) and the result is unfreakingbelievably good.
I saved 1/2 cup to use as the starter for the next batch and it looks like I need to get on that because there is only about a serving left. I'll try to take pictures next time.