Place 1/4 cup warm water in a large bowl. Sprinkle in yeast; stir until dissolved. Add remaining water, honey, butter, and salt. Slowly stir in 3/4 cup all-purpose flour and rye flour; blend well. Stir in remaining flour and caraway seed to make a stiff batter. Cover; let rest 20 minutes.
Stir batter down; turn into greased 9 x 5-inch loaf pan. Cover; let rise in warm, draft-free place until doubled in size, about 1 hour.
Bake at 375oF for 30 minutes or until done. Remove from pan; cool on wire rack.