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Grasmere is situated in Camden West, in the Camden local government area. It was assigned the status of a suburb of Camden in October 1991. It is separated from its immediate neighbouring suburbs Ellis Lane to the north by Werombi Road, and Bickley Vale to the south by Burragorang Road. A creek running parallel to Cawdor Road joining Matahil Creek – which runs into the Nepean River – is the eastern boundary to Camden and Cawdor. Sickles Creek to the west forms a natural border with Wollondilly Shire.
Its original inhabitants are the Tharawal and Gundungurra people.
Grasmere is part of the area first named West Camden in 1823 after the Government Prohibition Order against entry to lands west of the Nepean River to protect the cattle of The Cowpastures ceased, and Governor Brisbane was authorised to grant John Macarthur a further 5,000 acres (2023 hectares) adjoining his Camden Park Estate granted in 1805.
In 1885, 3,600 acres (1457 hectares) of Camden Park Estate north of Cawdor were subdivided into small farms of up to 130 acres (52.6 hectares) each. One of the buyers, of several properties, was William Henry Paling.
Grasmere was the name of Paling's property of about 450 acres (182 hectares), which he then gave in 1888 for the foundation of the Carrington Hospital, named after the Governor of New South Wales, Charles, Baron Carrington. Carrington Retirement Village has been developing and growing there in recent years, with a long waiting list of Camden residents planning to retire there. Carrington Hospital – including Grasmere Cottage, the former gardener's cottage, Masonic Cottage Hospital, the former morgue and front garden – is listed on the State Heritage Register. Our Boys Home, now known as Macquarie House, situated in Ferguson Road, was built in 1890 on land also donated by William Paling to 'The Society for Providing Homes for Neglected Children'.
Today, little remains of the once-thriving farming activities in Grasmere. It is being developed as an exclusive rural residential estate. With the population almost doubling in 12 years to about 1,000 in 2007 and development continuing, with careful management by Camden Council, Grasmere will largely remain the rural haven it is today.
Camden Council website, http://www.camden.nsw.gov.au, viewed 26 November 2008
Camden Historical Society website, http://www.camdenhistory.org.au, viewed 26 November 2008
RE Nixon, Carrington 1890–1990: The Centre of Total Care, The Carrington Trust, Camden NSW, 1990
GV Sidman, The Town of Camden: A Facsimilie, Camden Public Library, Camden NSW, 1995