The institution began with the organization of Grace Theological Seminary under the leadership of Alva J. McClain in 1937. A two-year "undergraduate division" of the seminary was added in 1948 and has since transitioned into a four-year Liberal Arts college.
Leadership
Alva J. McClain served as president until 1962, when he was succeeded by his colleague and fellow co-founder Herman A. Hoyt. He remained in this position until he retired in 1976, and was followed by then Dean of Grace Theological Seminary Homer Kent, Jr., who retained this position until his own retirement in 1986. Dr. John J. Davis then served in the position from 1986 to 1993. Ronald E. Manahan replaced Davis and led the institution until 2013 at which time William J. Katip, who had been Provost since 2007, replaced Manahan. New initiatives implemented in the fall of 2013 included an adjusted calendar in which each of the semesters were divided into two 8-week sessions.
Secondary locations
Prison program
For many years Grace College maintained a ministry to the incarcerated in Indiana at various correctional facilities throughout the state directed by Dr. John Teevan. However, due to legal changes in the state of Indiana, this ministry has transitioned to a GED program. The institution now manages the GED program for five correction facilities in northern Indiana.
Commuter Schools
Since 2011, Grace College has added a satellite location in Indianapolis. This site is a commuter location that offers associates and bachelor's degree completion. It is located at 96th and Meridian on the North side of Indianapolis.
The full-time tuition cost for the 2014-2015 school year was $24,670. In the fall of 2015, a program called "The Measure of Grace" caused full-time tuition to decrease to $22,450. For every consecutive year a student attends, his or her tuition will decrease by $500. Textbook rentals will also be free for all students.
Campus
There are a total of 21 buildings on Grace College's campus. Eleven of these buildings are residence halls, with the Lancer lofts, the Lodge and Omega Hall being as the most recent additions.
Campus activities
College newspaper
The college newspaper, The Sounding Board, is published biweekly. Dr. Paulette Sauders, who chairs Grace's department of Languages, Literature, and Communication, serves as the paper's faculty adviser.
Chapel
Grace College students attend chapel sessions Tuesday, Thursday, and Friday mornings in the Manahan Orthopaedic Capital Center on campus.
Athletics
Grace College sponsors 15 intercollegiate sports. Their students compete as "Lancers" with their mascot, Sir Red, cheering them on. The college is a member of the National Association of Intercollegiate Athletics Division 1, and competes in the Crossroads League, formerly known as the Mid-Central College Conference. Men's sports include baseball, basketball, cross country, soccer, tennis, and track & field; while women's sports include basketball, cross country, golf, soccer, softball, tennis, track & field, and volleyball. Grace's men's basketball squad, coached by Jim Kessler, won the NAIA Division II men's championship in 1992, and in 2013, advanced to the Final Four. On October 31, 2014, Coach Kessler achieved his 700th career coaching win.