Gracie hosted elegant dinner parties at his country estate for visitors including Alexander Hamilton, Rufus King, Joseph Bonaparte, and Washington Irving. Major losses during the years after the War of 1812 forced Gracie to sell his estate in 1823 to Joseph Foulke. In 1857, the Mansion was bought by Noah Wheaton. After Wheaton's death in 1896, the City of New York appropriated the estate, incorporating its 11 acres of grounds into the surrounding park that was renamed for Carl Schurz in 1910. After years of use as a comfort station and ice-cream stand, Gracie Mansion became the first home of the Museum of the City of New York. When the museum moved to a larger building, Parks Commissioner Robert Moses convinced City authorities to designate the Mansion as the official residence of the mayor. In 1942, Fiorello H. La Guardia moved into Gracie Mansion.
In 1966, the Mansion was enlarged with the construction of the Susan E. Wagner Wing, which includes a ballroom and two additional rooms. Under the guidance of The Gracie Mansion Conservancy, major restorations to the Mansion were undertaken between 1981 and 1984, and in 2002. The 2002 restoration transformed Gracie Mansion into the "People's House" and increased accessibility to the public and City agencies. First Lady Rosalynn Carter and South African President Nelson Mandela are among the many notable visitors.
Gracie Mansion is owned by the New York City Department of Parks & Recreation, operated by the Gracie Mansion Conservancy, and is a member of the Historic House Trust.