There are many myths surrounding yogurt making:

• UHT milk is bad. This is simply not true. I have made yogurt with whole fat UHT milk for years and it comes out nice and thick. In fact for the past several months I have been using a high quality whole milk powder that makes a lovely, thick yogurt.
• Store bought yogurt will always be thicker because of additives. Also not true. My yogurt is as thick as a high fat sour cream and contains no added milk powder, gelatine, etc.
• You need many hours of 'fermentation' to make yogurt. Again I don't agree. My yogurt sets in 3-4 hours, after which it goes in the fridge to cool and finish the culturing process.
• The milk must be exactly x temperature when you add the starter. This is only somewhat true. As long as the milk is at or below 45°C it is fine. If you can stand the temperature, so can the bacteria—ie, if you can hold a finger in it for ~10 sec, it's ok. That said, too low and you're losing some effects of the protein denature explained below.
• Everything must be sterilized. This is only somewhat true. Clean everything carefully, of course, but you are adding a starter with billions of cultivated bacteria into an ideal environment for it to grow. It will easily dominate other bacteria that happen to get in—and they will, since there are bacteria in the air all around us, so even post-sterilization there will be plenty of foreign stuff entering the yogurt. That said, an over-long incubation will give other bacteria a chance to express themselves, so best to avoid that.
• Don't move, touch, or cause the yogurt to shake in any way during incubation or it will fail. I used to believe this myself but it's really not that sensitive. Obviously less agitation is better, but it will not fail even with fairly substantial movement during the incubation. Drinking yogurt is shaken quite violently during incubation in order to keep it liquid and even then it's still quite viscous.

The keys to making good thick yogurt are:

• Protein. The milk becomes solid because of a protein in the milk, and for that to happen, the protein must first be heated to above 70°C. I heat it to 75-80°C for just a few minutes and it still turns out very thick. A milk with high quality protein will make a great yogurt.
• Incubation temperature. If you want to make good yogurt in 3-4 hours (beyond which it will not get thicker, only more sour), it must be incubated at a steady 40-45°C. A lower temperature will also produce yogurt, but you are in a race with other bacteria, so the quicker it's done the better. Buy a 75-cent indoor thermometer and start looking for ways to create the right temperature environment.
• Time between generations. Try to bake a new batch every 4-5 days. After a week in the fridge the bacteria are starting to suffer and will not be as strong and active when introduced into the next batch. A short generation cycle will let you go on making yogurt with the same culture for dozens of generations.
• Sugar quantity. This is my own personal guess based on bread making, etc. A little sugar will boost the bacteria, but too much will slow it down. I use 2 tbsp per litre of milk and it works very well. Tart with a hint of sweet. Up to double this amount should be fine but more could affect it. Like I say I'm guessing here but it seems to make sense.

Two final notes.

• The "water" that separates out of the yogurt is whey protein—generally seen as a very healthy thing to eat. A firm yogurt will let you pour it or spoon it off if you don't like it, but there's no reason not to just scoop it out with the rest or stir it back in.
• Fat content is important, but the milk protein is what will make or break the yogurt. I have made a very thick yogurt with skim milk powder or skim milk with added skim milk powder. Soy milk, which has quite a bit less fat than whole milk, makes a very solid yogurt. It's all about solids. Of course a >3.x% whole fat milk will produce a tastier yogurt, because milk fat is oh so tasty!

Further reading from an industry source: http://www.dairyconsultant.co.uk/si-yoghurt.php

Additional tips: http://www.facebook.com/diyhelpers

Your method is wrong. Look at this site.

1. Avoid UHT (Ultra Hight Temperature) pasteurized milk.
2. Heat the milk without the yogurt. You want the milk to reach about 90ºC for pasteurization.
3. Keep it at 90ºC for 20 minutes.
4. Let the milk cool down to around 40ºC before adding the yogurt.

The site has more info.

The reason your method isn't working is that you heat the milk together with the yogurt. Heating will create hot spots where the temperature can become really hot (killing the yogurt ferments). By letting the milk cool down to the desired temperature, there will be no hot spots, and all the yogurt ferments will be happily alive.

You have milk based yougurt. Try this:

INGREDIENTS:

Whole milk, double-cream both in measure 50/50 1L/1L (use non UHT the best you can get)

EDIT: I was wrong, see comments below my answer – they are correct about ingredients fat ratio

your yogurt starter (buy best pure yogurt you can get, one 150-200ml is sufficient)

METHOD:

Bring mixture of milk to boil and leave to cool down to 53-54 degrees celsius Add your yogurt and mix well (whisk is here great tool)

You can transfer it from the pot into termo-botles or just leave it in room temperature. It's bacteria and will work in lower temperatures, will just take longer (room temperature) Keep it away from drafts and dramatic temperature changes. (Kitchen next to central heating is good, or pre-heat oven over night to 50 or less degrees celsius, just for an hour and switch off and leave your yogurt pot in the oven).

So if you start morning, the next day morning your yogurt should be done. Yo can just use same pot and help them to stay warmer by wrapping it in cloths or blankets.

Than put your yogurt into a sterile glass jars and for at least 2 days leave it to carry on in fermenting slowly in the fridge.

EDIT: The most important point for yogurt to thicken properly is proper time lenhgt and proper temperature.

1. time 3h
2. temperature 42-45C

This would favor the bacterium which doesnt produce slimy runny texture but sat and silky.

Besides fixing the process by not heating the yogurt, i suggest a cheat: add 2 tablespoons of powdered milk for each liter of milk.

The OP has an extremely flawed process. So, poor results.

The milk (and not the starter, hopefully obviously) should be scalded - held at a fairly high temperature (180-185F 83-85C) for a good long time. It does not matter if it's UHT or Raw before you start - you are going go well beyond pasteurizing on the time front with the intention of changing the milk (so it sets better) rather than with the intention of killing things quickly and changing the milk as little as possible. If you pulled a sample of the milk at this point (I don't suggest doing so, as it provides a needless opportunity for contamination) it will taste distinctly cooked - like UHT, but more-so.

A minimum of 30 minutes is good, more does no harm. Jars or PP (#5) plastic containers over simmering water in a closed pot work fine. You can then let the milk cool to 115F 46C or so naturally, or force-cool it if you like that sort of fuss and bother. In covered jars or containers it is not at risk until you open it to add cultures. You should steam a spoon while you are at it, for mixing the culture in. Everything that touches the milk after the scalding process needs to be as clean as possible.

Once sufficiently cool, mix in 1 Tablespoon per quart / 15 ml per liter of starter - more is not better; as I recall, the culture likes to feel that it has some room too work, and excess starter inhibits it to an extent. If too hot, you'll kill the bacteria in the starter, so don't be impatient about cooling.

Then you need to keep it warm for a while. Approaches vary from packing it in insulation to hold itself (works better for a large quantity, or you can supply water in separate containers as additional warm thermal mass) to thermostatically controlled heated chambers. Temperatures can be from 115-95F (46-35C) and the specific temperature profile affects the balance of cultures you get, and thus the flavor and speed-of-setting of the yogurt. I happen to have arrived at 35-37 for 24 hours as suiting my tastes better, commercial production is focused on getting it done quicker to start the next batch and uses higher temperatures. Insulated-box methods obviously use a range of temperatures as the yogurt cools slowly.

Not disturbing the yogurt while the protein mesh is forming is fairly important in getting a good set. Commercial processes often use some sort of thickener such as corn starch or gelatin rather than depending on the yogurt itself to hold shape, but a good set is possible without those products, especially for a home product that does not need to be shipped.

While you certainly can add dry milk powder as an easy way to get extra solids, it's also not needed (and since it costs more than liquid milk where I am, I don't use it.)

I should be able to dredge up some references, eventually, but all my research was some years ago, and I built a process based on that research which is what I have related here.

Very simple, wrap it in a few layers of muslin cloth (aka cheese cloth) and hang it suspended over a bowl in the fridge for a day or two.

Keep it simple:

1. Good whole milk (sure, other varieties also turn to yoghurt, but it isn't the same)
2. Milk should be lukewarm when you add the 'starter' (It is not necessary for the milk to be boiled before that)
3. Keep it warm throughout the setting period. Don't let it cool to less than 25degC. Less than that the yoghurt formed is usually thin and runny. (Fired) Clay pots work best - one can almost cut the yogurt like custard. Ceramic is next best, especially if uncoated / unglazed. Metal vessels usually take away heat too fast, and the result is runny stuff!

Raw milk: must reach 85 ° (185 F) to change the protein. Store pasteurized milk: must be warmed to about 60 ° (140 F)

Cool down: To 40-45 ° (105-110 F)

Culture: More means more sour yoghurt. Per liter (1.056 quart US, 0.833 UK) Mild/Sweet: One metric tablespoon (1.014 US, 0.845 UK) Really sour: For Lasi (Dooq), dips (thickened) 4.25 tbsp (4.25 US, 3.5 UK) Anywhere in between shall work.

Container: glass, ceramic, glazed pot, plastic, clay JUST NOT THE CONTAINER THAT THE MILK WAS HEATED IN. No bare metal. Note: Transferring milk at the proper temp to a glass bowl shall cool it more than a plastic one. In large quantities not significant but in small quantities makes a difference. Wrap a towel or small blanket around the container.

Setting temperature for environment: 40-45 ° (105-110 F)

Lower range temp: loose or running High range temp: firm or set

Time: Longer means more sour 3.5-4.5 hours Refrigeration: 3+ hours to set finally.