The present invention provides a process for making hand-held shaped cereal and milk products having a smooth, homogenous-consistency texture and a moisture content higher than 35%, using about the same amount and ratio of cereal flour to fluid-milk as found in a traditional combination of (RTE) cereal pieces (made from cereal flour) and fluid-milk that have to be eaten from a bowl with a spoon. In the process of the present invention, each pound of cereal flour is cooked with 3 to 4 pounds of fluid-milk together with starch-complexing agents in a continuous cooker at temperatures above 175 F. It is then discharged as a hot, fluid-milk-hydrated, starch-complexed cereal flour which continues to absorb retained fluid-milk until it becomes fully-cooked, fully-hydrated and viscous enough to retain a shape. It is then formed into units, baked to firm their textures while retaining a higher than 35% moisture, and stored refrigerated or frozen.