While playing with Oobleck students should identify that normally solids have a definite shape whereas a fluid can change shapes because it flows.
Oobleck doesn't quite follow the rules, this suspension only behaves as a fluid some of the time. For this reason oobleck is known as a non-Newtonian Fluid. If you apply a force to it by smacking or squeezing it this fluid will become a solid.
A non-Newtonian fluid is a fluid that does not follow Newton's law of viscosity. In non-Newtonian fluids, viscosity can change when under force to either more liquid or more solid. Ketchup, for example, becomes runnier when shaken and is thus a non-Newtonian fluid.
The explanation for the strange behaviour of Oobleck lies in the shape of cornstarch particles, which are long and thin. When cornstarch mixes with water, the starch does not dissolve, but remains in suspension. Move the mixture slowly, and the particles slide past each other. Move it quickly, and the particles tangle with each other so that the mixture hardens.
Using a material that doesn't behave according to the 'rules' is a great way to get students to explore what they already know about the difference between solids and fluids.