Making your own yogurt is less expensive than anything you can purchase in the grocery store, and usually tastes better. Although it requires monitoring during its formation, the recipe is fairly simple.
Heat the milk (add the powdered milk if you want thicker yogurt) in a double-boiler, stirring continuously. You can use a regular saucepan on your stove, as long as you are very careful not to scorch the milk. The milk should reach 180 degrees Fahrenheit and stay there for one minute. Once it has reached the optimal temperature, remove it from heat and let it cool to 115 degrees Fahrenheit. If you need it to cool quickly, place the pan in a bath of cool water and stir the milk continuously.
Add the live cultures or starter to the milk once it has reached 115 degrees Fahrenheit. Try using a yogurt that you purchase at the grocery store as your starter, if you don't have any other options. If you want to add any sweetener, now is the time to do so. Stir the concoction well and pour it into smaller containers.
For the next four to six hours, you must keep the mixture at 110 degrees Fahrenheit. This is tricky. If it drops below that, the bacteria will not be able to grow; if it's higher than that, the heat will kill the bacteria. You can accomplish this task by putting the yogurt jars in a warm water bath and keeping it in an oven turned to its lowest setting. You could also pour hot water (that is, 115 degree Fahrenheit water) into a cooler and place your yogurt jars in it, checking periodically to ensure that the temperature is constant and adding warm water when necessary.
You will know that the yogurt is done when it's firm—it will not be as firm as you're expecting, however; it will come together more as it cools. Refrigerate the finished product and consume at will.