Grabouw is located some 65 km south-east of Cape Town, over Sir Lowry's Pass from Somerset West, along the N2 highway.

The town is the commercial centre for the vast Elgin Valley, the largest single export fruit-producing area in Southern Africa, which extends between the Hottentots-Holland, Kogelberg, Groenland, and Houwhoek Mountains.

The indigenous people of the region, the Chainouqua Khoi, inhabited a large area on both sides of the Hottentots Holland Mountains.

Other influential pioneers were the Beukes family and the Franco-Italian immigrant Edmond Lombardi, who created an apple-juice drink he called "Appletiser", on his nearby farm Applethwaite, and introduced it to the market in 1966.

The Elgin valley is South Africa's coolest climate wine-growing region and a range of other geographic factors (for example, its proximity to the Atlantic Ocean, cool temperatures, plentiful winter rainfall, prevailing wind directions, and altitude) have created a set of conditions for wine growing which are markedly different to those in surrounding areas.

[16][17][18][19][20] Grabouw and its surrounding valley is historically significant for South Africa's wine history also because, of all the country's regions, it had one of the earliest movements towards Black ownership of vineyards and wineries.

[21] The town's economy is based on servicing the surrounding agricultural industry, with the Elgin Valley being intensively used for viticulture and the cultivation of apples, pears, plums and other deciduous fruit.

The town has a number of schools: Situated by the Palmiet river in the fertile Elgin valley, Grabouw is surrounded by the Hottentots Holland and Groenland mountains to the north, and the Kogelberg Biosphere Reserve to the south.

There is also the annual Elgin Festival, which takes place on the last week-end in October and boasts a wide range of flower displays, fruit, wines and a great variety of local products.

The town experiences a very mild Mediterranean climate, more moderate than most other Western Cape locales, with abundant rainfall, mostly in the winter months, although strong summer south-easterly winds can sometimes bring squalls.