Preheat oven to 350°F. Cook spaghetti to desired doneness in unsalted water. Drain, rinse with hot water.
Lightly grease 13x9 inch baking pan. In large bowl, lightly toss cooked spaghetti with milk and egg. Turn into prepared baking pan, spreading evenly. Spoon Prego over top. Place pepperoni slices over sauce. Sprinkle with cheese.
Bake for 30 minutes. Allow to cool before cutting into squares.