The house was designed in 1870 by Norman Shaw for the Victorian era painter Frederick Goodall, who had purchased 100 acres of land at Harrow Weald in 1856, but he did not begin to build until a lease on the property expired. Construction on the house was completed in 1872. Goodall sold the property in 1880 to Robert Heriot. Dramatist W. S. Gilbert purchased the property in 1890. Gilbert continued to live at Grim's Dyke till his death (while trying to rescue a woman drowning in the pond) in 1911. There he kept a variety of animals including monkeys, lemurs, a lynx and many others. Thereafter, Lady Gilbert and the Gilbert's ward, Nancy McIntosh, lived there until Lady Gilbert's death in 1936.
A statue of Charles II was carved by Danish sculptor Caius Gabriel Cibber in 1681 and placed at the center of Soho Square in London. By the early 19th century, the statue was described as being 'in a most wretched mutilated state; and the inscriptions on the base of the pedestal quite illegible'. In 1875, it was removed during alterations in the square by T. Blackwell, of Crosse and Blackwell, the venerable jam firm, who gave it for safekeeping to his friend, Goodall, with the intention that it might be restored. Goodall placed the statue on an island in his lake at Grim's Dyke, where it remained when Gilbert purchased the property. In her will, Lady Gilbert directed that the statue be returned, and it was restored to Soho Square in 1938.
From 1963 to 1968, the house was used as a location for films and television including Futtock's End with Ronnie Barker. It was converted into a hotel in 1970. The hotel was seen in an off set episode of EastEnders. The house and its gatehouse are both listed buildings. The current owners purchased the property in 1996 and features presentations of Gilbert and Sullivan operas and other entertainments.