Preheat oven to 350 degrees F.
To make the breadcrumbs, toast 6-7 slices of Butter Bread on a baking sheet in the oven for about 10 minutes until dried, then pulse into crumbs using a food processor.
Prepare Meatloaf: In a small bowl, combine 1 tbsp. milk and the single slice of Butter Bread, and mash until creamy. In a large bowl, add the ground beef, breaking up into pieces, then add the milk-bread mixture, remaining ½ cup milk, toasted breadcrumbs, mushrooms, and remaining 8 ingredients. Mix until well combined.
Place mixture into 7×5-inch loaf baking pan or shape into free form loaf and place on a parchment paper-lined sheet pan. Place into preheated oven and bake for 45 minutes.
Prepare Mushroom Gravy:
In a small bowl, combine ¼ cup milk and cornstarch; set aside. In a large skillet, melt butter over high heat. Add the mushrooms and onions; stir and cook over moderate heat until the mushrooms are golden, about 10 minutes. Add flour, stir to coat, and cook for 5 minutes. Stir in beef broth (1/2 cup at a time) and bring to a simmer, then add Worcestershire sauce. Add in cornstarch slurry and cook over high heat, stirring constantly, until slightly thickened, about 1 minute. Taste for seasoning and adjust to taste with salt and pepper. Add more beef broth as needed to thin to desired consistency.
Cut Meatloaf into 1/2-inch thick slices and serve immediately, topped with mushroom gravy.
Recipe adapted from: https://www.mushroomcouncil.com