In a large mixing bowl, combine the all-purpose flour, instant yeast, salt, and granulated sugar.
In a separate bowl, mix the warm water, warm milk, and melted butter.
Pour the wet ingredients into the dry ingredients and stir until a rough dough forms.
Add the shredded cheddar cheese and chopped jalapeños to the dough and knead by hand or with a stand mixer fitted with a dough hook for about 8-10 minutes until the dough is smooth and elastic.
Place the dough in a lightly greased bowl, cover it with a clean kitchen towel or plastic wrap, and let it rise in a warm place for 1 hour or until doubled in size.
After the dough has risen, punch it down to release the air and turn it out onto a lightly floured surface.
Shape the dough into a loaf and place it into a greased 9×5-inch loaf pan.
Cover the loaf pan with a towel and let the dough rise again for 30-40 minutes until it has risen about 1 inch above the rim of the pan.
Preheat the oven to 375°F (190°C).
Bake the bread for 30-35 minutes, or until the top is golden brown and the loaf sounds hollow when tapped.
Remove the bread from the oven and let it cool in the pan for 10 minutes.
Transfer the bread to a wire rack and let it cool completely before slicing.