Born in Cincinnati to Dorothy Vernon Black, a secretary, and Philip Strang Grier, a doctor, Grier grew up in several midwestern US cities. She claims she came out as a lesbian at 12 years old and spent her life finding as much information about female homosexuality as she could. Her parents divorced when she was 13 years old. Grier went to the library to discover more about lesbians after noticing her own behavior patterns were different from her friends. She told her mother that she was homosexual, and her mother replied, "No, because you're a woman, you're a lesbian. And since 12 years old is too young to make such a decision, let's wait six months before we tell the newspapers." She began collecting books when her mother gave her a copy of The Well of Loneliness by Radclyffe Hall when she was 16 years old. She describes her collection of lesbian-themed books as Lesbiana, a collection that was fueled by a "love affair with lesbian publishing."

Shortly after Grier graduated high school in 1951, she met Helen Bennett in a public library. They spent 20 years together living in Denver, Colorado while Bennett went to library school, then moving to Kansas City where both worked in public libraries.

Grier began writing book reviews in The Ladder, a magazine edited by members of the Daughters of Bilitis, soon after subscribing to it in 1957. She used multiple pen names in her writings including Gene Damon, Lennox Strong, Vern Niven, most often writing to review literature in which lesbians were characters or a plot device.

Grier took over editing The Ladder in 1968 with the goal of expanding the magazine to include more feminist ideals. The magazine gained a more professional and sleeker layout and increased to more than 40 pages from the 25 average under previous editors and tripled in subscriptions. She described her roles in editing the magazine, ""In 1968, I became editor of The Ladder, and I had to write three hundred letters a week, edit the magazine, run a staff of fifteen people spread all over the world, work a part-time job, keep house, read the books, and write my 'Lesbiana' column." Grier also removed the word "lesbian" from the front cover, after being placed there in 1963, in an attempt to reach more women. Grier's tenure took place at a time when the Daughters of Bilitis were in conflict about the direction of the organization. DOB founders tended to encourage a more assimilation stance for the organization and came in direct conflict from more radical separatist lesbians, including Grier. When the DOB folded in 1970, Grier, who was editing the magazine from Kansas City, planned with DOB president Rita LaPorte to take the only two copies of the subscription list from the printer and the DOB headquarters in order to keep The Ladder alive. LaPorte took both copies to the ignorance of DOB founders Phyllis Lyon and Del Martin, and relocated the magazine to Reno, causing an uproar. The Ladder ran for two more years before it outgrew its finances and folded in September 1972. Said Grier about her role in the controversy, "You have to understand that none of these things were done with malice aforethought or with intention to damage. I mean I was just as much a light-eyed maniac then as I am now in terms of the mission. The mission is that the lesbians shall inherit the earth, you see."

Grier had been in a relationship with Helen Bennett for 20 years when librarian Donna McBride fell in love with her. Grier left Bennett for McBride and claims it was the only decision she ever agonized about.

Grier and partner Donna McBride began running Naiad Press at the support and urging of two editors of The Ladder, Anyda Marchant and Muriel Crawford in 1973. Their first published work was The Latecomer written by Marchant under the pen name Sarah Aldridge. Naiad was run from Kansas City until 1980 when it relocated to Tallahassee, Florida. Both women continued to work full time until 1982 when they dedicated all their time to the publishing company.

Authors represented by Naiad include Valerie Taylor, Katherine V. Forrest, Jane Rule, Ann Bannon's reprinted Beebo Brinker Chronicles, and Gale Wilhelm, whom Grier spent several years attempting to locate to bring out of obscurity. One of the most controversial of these was Lesbian Nuns: Breaking Silence, a work of non-fiction that was banned in Boston and criticized by the Catholic Church. Penthouse Forum ran a series from the book and it made Naiad an internationally-known publishing name.

Grier used her extensive lesbian literature collection, what she termed "Lesbiana" at Naiad. By 1994, the company had a staff of 8 and projected sales of $1.8 million US. In 1992, Grier and McBride donated Naiad's entire collection to the San Francisco Public Library, which consisted of a tractor trailer full of 14,000 books estimated at $400,000 US. What began as a search became a self-described obsession for Grier. She worked with Jeannette Howard Foster and Marion Zimmer Bradley to compile the largest collection of books with lesbian themes in the English language, they called The Lesbian in Literature. Books were rated from A to D referencing how important lesbian characters were to the plot, or T, indicating the book was "trash".

In 1985 Grier earned the President's Award for Lifetime Service from the Gay Academic Union. In 1991, Grier and McBride, representing Naiad Press, was given the Lambda Literary Award for Publisher's Service. Grier and McBride were given the Lambda Literary Pioneer Award in 2002. Grier and McBride sold the Naiad backlist to Bella Books in 2003.