Obesity affects 27.5% of Australian women. Breakfast cereal consumption has been proposed to be protective against obesity. This study investigated the association of breakfast cereal consumption with the risk of developing obesity (Body Mass Index (BMI) ≥ 30 kg/m2) over 12 years among mid-age participants in the Australian Longitudinal Study on Women’s Health (ALSWH). Dietary data were obtained at S3 and obesity incidence at S4–S7. Women were excluded if: dietary data were incomplete, energy intake was <4500 or >20,000 kJ/day, or they reported being overweight or obese at S3. Logistic regressions with discrete time survival analysis investigated the association between breakfast cereal intake and incident obesity and were adjusted for: area of residency, income, smoking, physical activity, hypertension, dietary intakes and a discrete measure of time. There were 308 incident cases of obesity. Any breakfast cereal intake was not associated with incident obesity (Odds Ratio (OR): 0.92; p = 0.68). Oat-based cereal (OR: 0.71; p = 0.01), muesli (OR: 0.57; p = 0.00) and All-Bran (OR: 0.62; p = 0.01) intakes were associated with a significant reduction in obesity risk. Among this cohort, muesli on its own, or as part of oat-based cereals, and All-Bran, were associated with a reduction in obesity. This effect may be due to particular characteristics of these cereal eaters, but the relationship warrants further investigation.