Located in the Agincourt neighbourhood along Birchmount Road, the hospital was opened in 1984 by The Salvation Army.

[1] The Scarborough Grace Hospital gained international attention when it became the centre of the severe acute respiratory syndrome (SARS) outbreak in Toronto after Tse Chi Kwai was admitted in March 2003.

On December 21, 2010, the Birchmount campus was approved for a magnetic resonance imaging machine by Gerry Phillips, Member of Provincial Parliament for Scarborough-Agincourt.

[8] On January 24, 2019, the Scarborough Health Network approved the closure of pediatric and obstetric services at the Birchmount Hospital.

A local campaign known as Save the Grace, headed by Toronto city councillor Jim Karygiannis, appeals to the Government of Ontario to stop plans of shutting down the hospital.