In 1842 the Michigan Central Railroad bypassed the original village and built a depot 1.5 miles to the west. The village was relocated to this new location - its current location - to be closer to the rail depot.
Grass Lake was named for the shallow, marshy lake just to its north.
Today the greater Grass Lake area includes the Village of Grass Lake, Grass Lake Township, and parts of the Waterloo Recreational Area north of I-94.
There were 421 households out of which 36.8% had children under the age of 18 living with them, 53.4% were married couples living together, 12.4% had a female householder with no husband present, and 30.2% were non-families. 25.4% of all households were made up of individuals and 9.5% had someone living alone who was 65 years of age or older. The average household size was 2.57 and the average family size was 3.06.
In the village the population was spread out with 26.9% under the age of 18, 9.1% from 18 to 24, 32.6% from 25 to 44, 18.3% from 45 to 64, and 13.0% who were 65 years of age or older. The median age was 35 years. For every 100 females there were 97.8 males. For every 100 females age 18 and over, there were 94.3 males.
The median income for a household in the village was $45,078, and the median income for a family was $52,143.About 2.2% of families and 4.3% of the population were below the poverty line, including 2.5% of those under age 18 and 4.0% of those age 65 or over.