Colloidal Oatmeal 5 Lbs Extra Fine Colloidal oatmeal is a product that consists of oats that have been ground very fine for use as a home remedy for itchy or dry skin. It typically is added to bathwater, creating a liquid that might be described as silky. The user soaks in this liquid for several minutes, and the oatmeal in the water coats the skin. Many people who suffer from certain skin conditions or ailments have reported finding some relief by using this home remedy.