Combine grits, water, and salt in a large saucepan; cook over medium heat 20 minutes, stirring occasionally. Remove from heat, and stir in butter. Add cornmeal, stirring well. Set aside to cool 10 minutes.
Stir eggs into cooled mixture. Gradually add milk, stirring well. Spoon batter into a lightly greased 2-quart baking dish. Bake at 350° for 1 hour and 5 minutes or until a knife inserted in center comes out clean.