To determine the optimal degree of milling (DOM) for processing highland barley rice (HBR), a comprehensive assessment of the nutritional composition, polyphenol content, antioxidant capacity, edible quality, and aroma compounds was conducted in 10 cooked HBR with varying DOM. Gas chromatography-ion mobility spectroscopy (GC-IMS) and relative odor activity value (ROAV) analysis were employed to identify the key volatile flavor compounds in cooked HBR. The results demonstrated that an increase in DOM led to a decrease in protein, fat, fiber, ash, total phenol, total flavonoid contents, and antioxidant activity of the cooked HBR. Conversely, total starch and β-glucan exhibited an increasing trend. The cooked HBR achieved its optimal overall sensory quality when the milling mass loss rate reached 14.54%. Additionally, 35 aroma substances in different cooked HBR samples were identified, including alcohols, aldehydes, ketones, and esters. Out of these compounds, 14 were deemed key volatile flavor compounds with a ROAV ≥1, and 7 compounds significantly contributed to the flavor differences among the samples. A comprehensive analysis found that a DOM of 14.54% was more suitable for preserving the nutritional function and improving the flavor characteristics of cooked HBR. This study offers valuable theoretical support for the development of HBR products.