Born Louis Honoré Charles Antoine Grimaldi in Baden-Baden, Germany, he was the only child of Prince Albert I of Monaco (1848 – 1922), and Lady Mary Victoria Hamilton (11 December 1850 – 14 May 1922). His mother was a daughter of William Alexander Anthony Archibald Hamilton, 11th Duke of Hamilton, and his wife, Princess Marie Amélie Elizabeth Caroline of Baden.

Within a year of his parents' marriage Louis was born, but his mother, a strong willed 19 year old, disliked Monaco and was unhappy with her husband. Shortly thereafter, she left the country permanently, and the princely couple's marriage was annulled in 1880. Louis was raised in Germany by his mother and stepfather, Count - and later Prince - Tassilo Festetics von Tolna, along with his eldest half sister, Maria - Mathilde (later grandmother of Ira von Fürstenberg), and did not see his father until age 11 when he was obliged to return to Monaco to be trained for his future royal duties.

Louis' father, Prince Albert I, was a dominating personality who had made Monaco a center of cultural activity and whose intellectual achievements were recognized around the world. Unhappy, living with his cold and distant father, as soon as he was old enough, Louis went toFrance, enrolling in the Saint-Cyr Military Academy. Four years later, after graduating, he asked to be posted with the French Foreign Legion fighting the wars in the African colonies.

While stationed in Algeria, he met Marie Juliette Louvet (1867 – 1930), a cabaret singer. (Juliette was already the mother of two children, Georges and Marguerite, by her former husband, French "girlie" photographer Achille Delmaet.) Reportedly, Prince Louis fell deeply in love but, because of what in those days was seen as her ignominious station in life, his father would not permit the marriage. It has been asserted that Louis ignored his father and married Juliette in 1897: there is, however, no evidence for this allegation. Their illegitimate daughter, Charlotte Louise Juliette, was born on 30 September 1898 in Constantine, Algeria. (There is no mention of Marie Juliette Louvet in the authorized biography of her grandson, Prince Rainier III, who is Monegasque by nationality but genealogically is French, Mexican - Spanish, Italian, German, and Scottish.)

For ten years, Louis served in the military with distinction, being awarded the Cross of the Legion of Honor. In 1908 he returned home, leaving behind his mistress and daughter. At the outbreak of World War I, he re-enlisted in the French Army, proving to be one of the Fifth Army's most outstanding soldiers. He was made a Grand Officer of the Legion of Honor and eventually became a Brigadier General. While many of his Grimaldi ancestors had served in the military, none had ever acquitted themselves with more distinction than Louis.

A political crisis loomed for the Prince because without any other heir, the throne of Monaco would pass to his first cousin Wilhelm, the duke of Urach, a German nobleman who was a son of Prince Albert's aunt, Princess Florestine of Monaco. To ensure this did not happen, in 1911 a law was passed recognizing his bastard daughter, Charlotte, as Louis's acknowledged heir, and making her part of the sovereign family. This law was later held to be invalid under the 1882 statutes. Thus another law was passed in 1918 modifying the statutes to allow the adoption of an heir, with succession rights. Charlotte was formally adopted by Louis in 1919, and became Charlotte Louise Juliette Grimaldi, Princess of Monaco, and Duchess of Valentinois.

Wilhelm, 2nd Duke of Urach, thus placed further back in the line of succession to the throne of Monaco, was chosen as King of Lithuania for a few months in 1918, being known as Mindaugas II. It is thus a moot point whether it would have been possible for him to be the sovereign of two small European countries simultaneously, had he in fact succeeded to the throne of Monaco, but he had several sons. In any case he renounced his claim to the principality in 1924, passing it to other French cousins that were also descended from the Grimaldi family, the counts of Chabrillan. Also at the end of the First World War, the French Government had forced the abdication of Marie - Adélaïde, Grand Duchess of Luxembourg, another small neighbouring country to France, on the grounds of personal links with Germany deemed to be inadmissible. Duke Wilhelm, similarly, would have been unacceptable to France, unlike Charlotte; even though he had spent a great deal of his early life in Monaco, he had served as a German army general in the war, contrasting with Louis' long service in the French army.

On 17 July 1918, largely because of the von Urach potential claim, France and Monaco had also signed a brief but far-reaching treaty requiring prior French approval of all future Monégasque princes. Article 2. specified: "Measures concerning the international relations of the Principality shall always be the subject of prior consultations between the Government of the Principality and the French Government. The same shall apply to measures concerning directly or indirectly the exercise of a regency or succession to the throne, which shall, whether by marriage or adoption or otherwise, pass only to a person who is of French or Monégasque nationality and is approved by the French Government." Under article 3 Prince Albert agreed "...for himself and his successors the commitment assumed towards the French Government not to alienate the Principality, in whole or in part, in favour of any Power other than France."

On 27 June 1922, Prince Albert I died in Paris. Louis Grimaldi ascended to the throne as Louis II, Prince of Monaco. While his reign never achieved the grandeur of his father, Louis II left an indelible imprint on the tiny principality. In 1924 the Monaco Football Club was formed and in 1929, the first Grand Prix of Monaco automobile race was held, won by Charles Grover (aka "Williams") driving a Bugatti painted in what would become the famous British racing green color. He collected artefacts belonging to Napoleon I which are now assembled and displayed in the Napoleon Museum attached to the Royal Palace in Monte Carlo.

Particularly in the earlier years of Prince Louis' reign, he acquired the reputation for administrative probity: he obtained the departure of Camille Blanc who had long managed Monte Carlo Casino, about whom there were increasing questions as to his administration of the Casino's affairs.

In 1931, the prestige of Monaco's cultural life received a boost when René Blum was hired to form the "Ballet de l'Opéra à Monte - Carlo." Just before the outbreak of World War II in 1939, a modern large football stadium had been built where the World University Games were staged at the newly named "Stade Prince Louis II."

While Prince Louis' sympathies were strongly pro-French, he tried to keep Monaco neutral during World War II but supported the Vichy France government of his old army colleague, Marshal Pétain. Nonetheless, his tiny principality was tormented by domestic conflict partly as a result of Louis' indecisiveness and also because the majority of the population was of Italian descent and they supported the fascist regime of Italy's Benito Mussolini. In 1943, the Italian Army invaded and occupied Monaco, setting up a Fascist government administration. Shortly thereafter, following Mussolini's collapse in Italy, the German army occupied Monaco and began the deportation of the Jewish population. Among them was René Blum, founder of the Opera, who died in a Nazi concentration camp. Under Prince Louis' secret orders, the Monaco police, often at great risk to themselves, warned people in advance that the Gestapo was about to arrest them. However, throughout the War, Prince Louis' vacillation caused an enormous rift with his grandson Rainier, the heir to the throne, who strongly supported the Allies against the Nazis.

For a number of months in 1944, communists participated in the Liberation administration of Monaco and it is a moot point to debate how strong a position Louis II was in, in 1944, to resist any attempts to abolish the monarchy in Monaco.

Following the liberation of Monaco by the Allied forces, the 75 year old Prince Louis did little for his principality and it began to fall into severe neglect. By 1946, he was spending most of his time in Paris and on 24 – 27 July of that year, he married in Monaco for the first time. His wife was Ghislaine Dommanget (1900 – 91), a French film actress and former wife of actor André Brulé. Absent from Monaco during most of the final years of his reign, he and his wife lived at Marchais, the family estate near Paris.

Prince Louis died in 1949 in the Prince's Palace and is buried at the Saint Nicholas Cathedral in Monte Carlo, Monaco. His widow, Ghislaine, Dowager Princess of Monaco, died on 30 April 1991 in Paris, where she was interred in the Passy Cemetery.

Hereditary Princess Charlotte ceded her succession rights to her son, Rainier, in 1944, at which time he became Hereditary Prince. When Louis died five years later, he was succeeded by his grandson, Prince Rainier III.

He was the 298th Grand Cross of the Order of the Tower and Sword.