Mick Skolnick told GameDev.net in 2002 that he had worked in the cosmetics industry, retouching photographs for advertisements, after studying art in college; his brother Ted was a software developer and former engineering student.

[2] According to the developers, Bad Milk was created to serve as "video installation art",[3] something the pair were keen to get involved with but which proved too expensive.

[2] The pair worked out of their apartments in Queens, New York, since they couldn't afford to rent office space in the city.

Clues are hidden in FMV clips including a "dismembered bald head, a disembodied voice, a drowning man, and chronic smokers",[3] and often use reversed audio.

[2] It was ultimately awarded the Seumas McNally Grand Prize and the Innovation in Audio award at a ceremony at the Game Developers Conference in San Diego;[7] Alex Dunne, then chairman of the IGF, said in a statement that "the 2002 IGF honorees exemplify the 'outside the box' thinking that keeps innovation at the forefront of video game development".