Grodal gained her degree (1962) and her masters (1968) in mathematics and physics from the. Also at the University of Copenhagen she earned her Ph.D. in mathematics under Werner Fenchel, her dissertation, A critical overview of the present theory on atomless economies, won a gold medal, something which was used to support young scholars in the old Danish academic system.
She was the middle child having both a younger and an older brother. Grodal was interested in mathematics from a young age and used to fill the pages of her psalm book with equations. Birgit Grodal worked on micro-economic theory, mathematical economics, and general equilibrium theory.
In 2010 the European Economic Association Council agreed unanimously to institute a prize in her honor to a European-based female economist who has made a significant contribution to the Economics profession. Danmarks Nationalbank agreed to sponsor the first three awards. The recipients of the Birgit Grodal Award are: 2012: Hélène Rey 2014: Rachel Griffith.
She was also a member of the Econometric Society starting in 1981 and served on the executive committee between 1997 and 2000.