Dismissed in February 2012, he moved to Huddersfield Town, where he again gained promotion from League One via the play-offs, beating Sheffield United in the final.

In February 2013, Grayson became the new manager of Preston North End, winning promotion from League One to the Championship with them in 2014–15, and later had short spells in charge of Sunderland, Bradford City, Blackpool again and Fleetwood Town.

During his time at Filbert Street the team won the League Cup in 1997, with Grayson scoring the goal against Wimbledon which put them in the final,[3] and was voted the club's player of the season in the same year.

He started his career at Blackpool in the right-back berth, but was moved to midfield by former boss Colin Hendry to bolster an area of weakness.

In late 2006, he led Blackpool to only one defeat in fourteen league games, a sequence that included five wins out of six, resulting in their appearance in the four play-off positions.

[10] On 6 January 2007, he guided Blackpool to the fourth round of the FA Cup for the first time in 17 years, after beating Aldershot Town 4–2 at Bloomfield Road.

They were knocked out by Norwich City, who beat them 3–2 after extra time, in a replay at Carrow Road on 13 February, narrowly missing out on a trip to London to face Chelsea in the last sixteen.

They met Yeovil Town in the final at the newly renovated Wembley Stadium on 27 May and won 2–0, securing promotion to the Championship.

[23] Grayson's first game in charge was at Elland Road on Boxing Day against one of his former clubs, Leicester City, who were top of League One.

Leeds were sitting in 9th place, on the back of five straight defeats, but a late equaliser from Robert Snodgrass gave Grayson's new club a 1–1 draw.

[25] Leeds won their final eleven home games, matching a forty-year-old record from the Don Revie era.

[27] Grayson's side also earned Leeds a replay against Premiership opposition Tottenham Hotspur after a 2–2 draw at White Hart Lane.

[28] Grayson's Leeds side was promoted on 8 May 2010 after beating Bristol Rovers 2–1 in their final game coming back from 0–1 with only 10 men.

[35] His first game in charge of the Terriers was in their 2–0 home victory over Exeter City when both defender Jamie McCombe and leading striker Jordan Rhodes scoring.

[48] Twelve months later, Grayson guided Preston back to the second tier of English football after being absent for four years with a victory over Swindon Town in the League One play-off final.

[49] On 29 June 2017, Grayson was named as the new manager of newly relegated Championship club Sunderland, replacing David Moyes, on a three-year contract.

[59] On 26 September 2017, his team suffered a 5–2 loss to Ipswich Town at Portman Road, with them moving down to twenty-third place in their division.

[66] On 6 July 2019, the day after Terry McPhillips announced his resignation, Grayson was appointed Blackpool manager on a two-year contract.

[71] On 8 June 2022, Indian Super League side Bengaluru FC announced the appointment of Grayson on a two-year deal.