Add the water and milk to the bread pan with the sugar and the yeast and let rest for 15 minutes to proof the yeast.
While the yeast is proofing, slice the strawberries and coat with the 1/4 cup of sugar. Toss to coat all of the strawberries.
Add the remaining ingredients to the bread pan but reserve the strawberries. If you have a fruit and nut hopper, add the glazed strawberries to the hopper.
Select the basic white bread setting for a 1.5-pound loaf and a medium crust.
If you don’t have a fruit and nut hopper, listen for the beep towards the end of kneading cycle and add the strawberries.
When done, remove from the bread pan and let rest on a wire rack for 10 minutes. Slice and serve.