In 1954 Pastor Paul Geiger was the pastor of First Lutheran Church in San Marcos. The congregation started a Lutheran school which quickly outgrew their facility. Since they had prayed that God bless their efforts to have a school Pastor Geiger sought a larger facility and found the current site of Grace Lutheran Church. Half of the congregation wanted to continue with the school and half did not want to continue having a school. The Lutheran Church Missouri Synod wanted more schools and invited those who backed the school to affiliate with LCMS. Half the congregation stayed with the American Lutheran Church and half went to LCMS with Pastor Geiger. The first service at Grace was held on December 2nd 1956. The school grew and blessed many San Marcos residents. When the public schools began offering free Kindergarten, Grace decided to close its school in 1974. Grace continues to have services and is involved in the community under the leadership of Pastor Craig DuBois.