The Kelly family's motorsport roots ran through their parents, John and Margaret Kelly, who had previously co-founded the HSV Dealer Team alongside Tom Walkinshaw. After a difficult relationship with Walkinshaw, the Kellys took their two Racing Entitlement Contracts (RECs) and founded their own operation. They acquired much of the hardware and personnel from Larry Perkins' Perkins Engineering team, which scaled back at the end of 2008. Perkins retained ownership of his RECs and was listed as entrant for two additional cars, giving the new team effectively four-car capacity from the outset. The team's primary sponsor was Jack Daniel's, which followed Todd Kelly from the Perkins operation, aligning with the brand's "Old Number 7" racing number.
Rick and Todd Kelly were the lead drivers from the beginning, supported by Jack Perkins and Dale Wood as co-drivers. The team's debut came at the 2009 Clipsal 500, where the brothers immediately cracked the top ten. Through 2009, Rick Kelly was the stronger performer, recording fourth-place finishes at Winton and Hidden Valley, and the brothers came within sight of a Bathurst 1000 victory before a damaged rear wing and a late safety car dropped them to eighth.
The team's first race win arrived in 2011, when Rick Kelly took the chequered flag in wet conditions at the Hamilton 400. Todd Kelly finished third in the same race despite competing with a broken windscreen wiper. Rick added further victories at Hidden Valley and Sandown that season, confirming 2011 as the team's strongest campaign under the original Kelly Racing banner.
Jack Daniel's remained a prominent sponsor for several years, with the team running as Jack Daniel's Racing and separately as Kelly Racing for the Perkins-licensed entries.
In one of the most significant manufacturer switches in Supercars history, the team announced during 2012 that it would race Nissan Altimas from 2013 onward, becoming the first team to change manufacturers under the new regulations. The team rebranded as Nissan Motorsport. Michael Caruso and James Moffat joined Rick and Todd Kelly as the expanded four-driver lineup. In January 2013, the Perkins RECs were purchased outright by the team.
The Nissan years produced competitive moments, including Caruso winning a race at Hidden Valley in 2016, but the team found it difficult to challenge the Holden and Ford factory programs on a consistent basis. Todd Kelly retired as a driver at the end of 2017 and was replaced by Andre Heimgartner for 2018. Simona de Silvestro drove for the team from 2017 to 2018.
Following the termination of Nissan's commercial sponsorship, the team reverted to the Kelly Racing name in 2019 and continued racing Nissan Altimas under licence. For 2020 the team contracted to two cars and made another manufacturer switch, this time to Ford Mustang GTs. The surplus RECs were sold to Team 18 and Matt Stone Racing.
In 2021, the Grove Group acquired a 50 percent shareholding and the team was rebranded Kelly Grove Racing. Rick Kelly retired from driving at the end of the 2020 season; David Reynolds joined the squad bringing Penrite sponsorship and carrying the number 26, chosen to reference 1926, the year Penrite was founded. Andre Heimgartner continued in car number 7. The team also ran cars in the new TCR Australia Touring Car Series from 2019, fielding Opel Astra TCRs branded as Holden Astras alongside Subaru WRX STI TCRs.
In 2022 the Grove Group took 100 percent ownership and the team was renamed Grove Racing, with neither Kelly brother continuing their involvement.
The Kelly-founded team's longevity and adaptability across Holden, Nissan, and Ford machinery, combined with its endurance through multiple ownership changes, made it one of the notable mid-tier operations in Australian touring car racing across nearly two decades of Supercars Championship competition.