Bring a large pot of salted water to a boil. Add pasta and cook according to package instructions to "al dente". Drain, return to stove top.
Over low heat, add milk and Velveeta to pasta; stir in a small amount at a time of the smoked cheddar (3 oz. total, save 1 oz. for topping). Stir frequently until all cheese is melted. Will thicken as it sits.