The origins of the municipality can be traced to Einar Einarsson's decision to move there to build and run a shop in 1897. During that time the population was only around 360. Fishing had for centuries been a crucial element in the survival of Grindavik's population, but fishing trips were often dangerous. Men were frequently lost at sea and the catch not always stable. However, when a safer access point to land was created at Hópið in 1939, fishing conditions changed dramatically. From 1950 serious development in the fishing industry had begun to take place. Grindavik was declared a municipality in 1974.