In 1354 Grožnjan's new owner became Volrich, or Ulrich, Reifenberg, who in 1358 sold it to Venice for 4,000 ducats in order to pay his debts.

In 1359 the Umag captain Pietro Dolfin moved to his new residence in Grožnjan, and in 1360 and 1367 he fortified the town walls and renovated the palace.

In the 15th century judicial duties were performed by the Pietrapelosas, and in 1446 the town walls were fortified in order to protect it from possible Turkish attacks.

In order to revitalize the area the St. Mark's Republic brought Italian families from Veneto and Friuli; these were mostly tradesmen who settled in towns.

The economic success of the colonization of villages was reflected in the towns as well: trade and transportation developed and demographics improved.

In 1816 the Austrian Emperor Francis II visited Grožnjan on his tour through Istria and met with the local clergy and population.

The town had a doctor, a post office, a school, a lawyer, a notary public, an oil processing plant, a bakery, groceries and clothing stores, two butchers, several inns, and various trade shops (shoemakers, blacksmiths, tailors, carpenters, etc.).

During the rule of the Kingdom of Italy Grožnjan attained waterworks, the area was electrified, and the Mirna river valley was reclaimed.

The new Yugoslavia's emergent communist system and its application, along with lingering hostilities between Italians and Yugoslavs (like the murder of priest Francesco Bonifacio), contributed to a large wave of emigration (part of the Istrian–Dalmatian exodus).

In 1965, when the Town of Arts was founded, some of the housing was given to artists from Croatia, Slovenia, and Vojvodina, and some were assigned to the Cultural Centre of the International Music Youth Federation in 1969.

It has about 20 art galleries, it hosts summer film school, and it has become an international center of Croatian music youth.