The town's origins date back to Etruscan times, of which Grotte was a very important center. Originally it was located near the border between Vulci and Volsinii and between the VII and VIII centuries A.C. it experienced a remarkable development witnessed by the extension of the surrounding necropolis.
Between mid-VI and III century A.C. the town went through a period of crisis due to the economic difficulties that in that period hit the whole Etruria and to Roman expansionism on volsinese territory.
The ancient settlement was deserted already during the eighth century P.C. in conjunction with the invasion of the Lombards, which forced the inhabitants to move to the nearby safer cliff , where stands the current Grotte di Castro.
The name "Grotte di Castro" (litterally meaning Castrum Caves) comes from the fact that the people on the run, deprived of all their possessions, were forced at first to use caves as their dwellings. However we have to wait for 1077 to see appear on a document the official name "Grotte".
In 1119 D.C. Grotte di Castro fell under the power of Orvieto, as many of the surrounding villages and, following the looting suffered by Henry VII in 1186, the boundary wall was built.
In the sixteenth century Grotte became part of the Duchy of Castro and in 1537 it went under the Farnese family. In this period the medieval village underwent a big urban development with the construction of the Palazzo Innocenzo Iuzzi and the palazzo del Vignola.
Under the guidance of the Farnese, the town experienced a climate of peaceful coexistence, unfortunately destined to disappear when in 1649, the city of Castro was invaded and destroyed by the papal army of Innocent X. By now it came under the control of the Holy See, until the capture of Rome and the annexation of all the provinces of Lazio to the kingdom of Italy in 1870.
Since then, the village found itself to be subjected to the Albertine Statute until 1946, when Italy passed from monarchy to republic.