Grails 1.3.7 works (in my experience) without an internet connection, except for the first start:
In the first run, it will resolve dependencies from the Internet. But they will be cached locally (check the $user/.grails , $user/.m2 and $user/.ivy2 folders). In the next run, you will not need an Internet connection.
But there is one catch - if one of your plugins depends on the version of the snapshot, it will try to connect to the Internet every time you start your project to see if there is a newer version. See This Grails Question : Working Offline with Snapshot Dependencies for a Solution.
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