Gracemere, a rural town, is 10 km south-west of Rockhampton. It was named after the Gracemere pastoral station (originally named Farris), established by Charles and William Archer, pioneer European settlers of the Fitzroy region, in 1855. The change of name to Gracemere was a compliment to the wife of their brother, Thomas. The Gracemere estate became a noted sheep and cattle property.

In 1871 a government school and a Protestant church were opened at Gracemere, and three years later the district's first agricultural and pastoral show was held there. The show was a foretaste of the districts suitability for dairying, poultry, fruit and vegetable growing for an expanding Rockhampton. Gracemere stayed a small country town, with Pugh's Queensland directory (1924) recording just two storekeepers, a hotel, a butcher and a fruiterer. This retail profile was virtually unchanged in 1970, although there were also Catholic and Anglican churches, and a large regional livestock saleyard (1953). The saleyard was an addition to Gracemere's sole mining industry, a granite quarry (1916).

In 1984 work began on building the Stanwell power station south-west of Gracemere. The workforce grew to 1200 by 1991, mostly accommodated at Gracemere. It was the beginning of Gracemere's urbanisation. Upon the completion of the power station in 1993, the local workforce was enlarged with the construction of Australian Magnesium Corporation's magnesite treatment plant next to the power station (2001). By the mid-1990s the shire plan contained reference to the Stanwell-Gracemere industrial corridor.

Gracemere has bowling, golf and swimming facilities, local shops, a Catholic primary school (1988), a second state primary school (1987) and the former Fitzroy Shire offices which were transferred from Rockhampton in the early 1990s. The saleyards include stud livestock-selling facilities, a 1000-seat sales ring and a stadium for horse events and stud-cattle displays. There is a large area in Gracemere for manufacturing and other industries. The heritage listed Gracemere homestead (c1858) is near the Gracemere Lagoon, immediately north of the Capricorn Highway. The town's census populations have been:

Census DatePopulation
188164
1901226
1933423
1976292
19811263
19913403
20014463
20065061
20118401
Further Reading: 

Grace Johansen, Pioneers to prosperity: a history of Fitzroy Shire, Rockhampton, CQU Press, 2003