How would I know if my toddler is allergic to milk?

Milk allergy. If milk or milk products are consumed and stomach cramps or diarrhea occur, this in usually a sign of lactose intolerance and not allergy. If lactose-free products are consumed and the observed reaction persists, then this would be more suspicious for milk allergy. Milk allergy can cause hives, itchy rashes (eczema) severe allergic reactions (anaphylaxis or asthma) and even nasal congestion.