During the summer of 1920, a 16-year-old girl presented herself for work at 50 Gordon Square in Bloomsbury, close to the British Museum in London. Her name was Grace Germany, and she had been sent by an agency in Norwich to act as housemaid to Mrs Vanessa Bell. It is possible that she knew her employer to be one of the leading artists of the day; what she cannot have guessed at was the unconventional nature of her household – or that she herself would be part of it for more than 50 years. Her diaries – filed under "Higgens", the name she took on her marriage in 1934 – have recently been acquired by the British Library. Bought from her family for about £40,000, they give an entirely new perspective on the life of Vanessa Bell and her circle: although countless books have been published on the Bloomsbury group, this is the first discovery of a substantial record written from a servant's point of view.

To academics, their main interest will be as a record of the comings and goings at Charleston, the Sussex farmhouse that acted as a country retreat for the Bloomsbury group, where Grace was installed as housekeeper. But they also shed fascinating light on life below stairs in the aftermath of the first world war, and show that the sexual promiscuity for which the group was notorious had echoes among its domestic staff.

Vanessa Bell's strange marital arrangements are so central to Grace's story that they are worth briefly setting out once more. The elder sister of Virginia Woolf, Vanessa was married in 1907 to the art critic Clive Bell, by whom she had two sons, Julian and Quentin. The couple remained together for only a few years, chiefly because of Clive's infidelities, which included a flirtation with his sister-in-law, Virginia. Vanessa herself had a passionate affair with the art critic Roger Fry, and subsequently set up house with the painter Duncan Grant, even though he was primarily homosexual. According to Jane Dunn, the author of a study of Vanessa and Virginia, "Vanessa soon learnt that in order to keep Duncan happy and at her side she had to tolerate and encourage, sometimes even court, the men on whom his sexual interests were focused". And indeed her time at Charleston began as part of a ménage à trois with Duncan and his then boyfriend, the bisexual novelist David "Bunny" Garnett. Despite all this, Clive remained a close friend and frequent visitor, and when Duncan and Vanessa had a daughter, Angelica, Clive agreed to pretend that the child was his. The final twist came when Angelica grew up to marry David Garnett, who was 26 years her senior.

How long it took Grace to fathom what was going on around her we do not know. The daughter of a Norfolk farmer, she was an intelligent girl with a very limited education, having left school at 13 and gone to work, according to an autobiographical note, in "Stamp, Jam & Gramophone factories". Her first experience of domestic service was a bad one: the doctor who employed her had "an awful temper" and her routine was unremittingly tedious: "Work just as usual" sums up a typical day. But to open her diary for 1921 is to discover a young woman who has taken on a new lease of life. In October she accompanied Vanessa Bell, Duncan Grant and Vanessa's three children for three months to stay in a rented house near St Tropez, and her account is full of girlish exuberance – as well as a strong sense of the absurd. Changing trains en route is a taste of things to come: "we were quite unprepared & had to rush very quickly to get our luggage out, (which we threw out of the window) before the train started again. Mr Fry was waiting on the platform..."

St Tropez at the time of Grace's visit was a small fishing village, a world away from the glamorous resort it would become. Her first impressions were less than favourable: "the streets smell disgusting," she writes, "& there are no shops worth going into". But she managed to make some good friends among the locals, and by the end of her stay was sad to leave ("It seems awful to think we may never come here again").

Duncan Grant strikes a particularly comic figure in Grace's diary. A man of extraordinary charm and incorrigible promiscuity, he enjoyed causing what he called "havoc" with his sexual activities. His homosexual admirers included the biographer Lytton Strachey and the economist Maynard Keynes, but he also had a predilection for petty criminals. Quentin Bell's memoirs include a mention of "a very amusing young man who for a time kept a restaurant in Lewes and collected pictures; unfortunately, his way of collecting landed him in jail". Duncan had a vague, unworldly manner which caused endless amusement to those around him. Grace records him wheeling the washing into St Tropez on Angelica's pushchair, and borrowing 13-year-old Julian's overcoat ("I do not think I ever laughed so much ... the sleeves reached to his elbows"). On the beach, he vacates a changing hut to make way for Grace and another girl: "the poor man having left his trousers inside, had to trot about with his shirt safety-pinned between his legs, to prevent it blowing up". Vanessa is a more poised figure, for although she had rebelled against her Victorian upbringing with a vengeance, displaying a shameless enjoyment of sex and a bawdy sense of humour, she believed in maintaining the traditional distance between employers and servants. But even she loses her dignity when the owner of the house arrives, "putting us all in great commotion... [Madame Vidrac] has yellow hair of the most extraordinary hue, a complexion which she makes herself and a very shrill voice. Mrs Bell in a terrible state?" Vanessa, meanwhile, recorded her impressions of Grace abroad in a letter to Clive: "Our French cook... is very practical and I think looks upon Grace as a hopeless amateur – as indeed she is, traipsing around in exquisite transparent clothes, with a handkerchief tied around her head, very lovely and quite incompetent. However, she picks up a few words of French occasionally and makes herself understood with the help of a dictionary." Photographs of Grace from this period show a gangling young woman with a long, inquisitive face and bobbed hair. Quentin Bell later recalled her as "a lively, innocent, forgetful and easily startled girl, coping in the most amiable manner with the eccentricities and vagaries of artists and their friends". She was not conventionally beautiful, but there is no doubt that men found her very attractive: among those mentioned in the diary is a French army officer ("he wanted to come part of the way back with me, but I managed to give him the slip"). The least prepossessing is a customer in a shop who overhears her buying underwear: "whenever the wretched man saw me in St Tropez he came & whispered the French name for bloomers".

Back in London, Grace resumed life as part of "the Click", as the gathering of servants in Gordon Square was known. The Click was a combination of two households, since there were continual comings and goings between No 46 (originally inhabited by Vanessa's family, then leased to Maynard Keynes) and No 50, to which Vanessa had moved in 1920. Of all Grace's diaries, the one for 1924 is the most detailed, revealing more than any other the pattern of relationships below stairs in Bloomsbury and Sussex, with their undercurrents of flirtation and jealousy. Chief among the dramatis personae are Mrs Harland, the cook; Alice Mary, a housemaid who is, in the terminology of the day, a brazen hussy, happy to talk about sex and become involved with married men; and Edgar Weller, an occasional helper at Charleston who is clearly smitten with 20-year-old Grace. "I have been trying to write to Edgar," she notes on February 29, "but I really do not know what to say, as he is so serious, he talks of settling down, & I am sure I cannot settle down." Perhaps her employers' freethinking attitudes had begun to rub off: she certainly saw herself as an independent modern woman, proud of her left-wing views, which may have originated in the factories where she had worked in her early teens. They were certainly fuelled by the sight of children and war veterans begging on the streets of London beside shop windows filled with "wonderfull [sic] creations": one little boy, "like a skeleton dressed up", made an especially deep impression. Grace's politics, and a strong sense of sexual morality, put her at odds with Mrs Harland in particular: "I had an awful row nearly down stairs, about my awful Socialist views," she writes on March 5. "Mrs Harland thinks, that the poorer classes, never ought to be allowed to raise themselves up... Mrs Harland also thinks that if a wealthy man offered to make advances towards a poor girl, she should be honoured & allow him to do whatsoever he liked with her, for the sake of a few miserable shillings" Also she thinks I am mad because I said if a rich or poor man wanted me he would have to marry, for if I was mistress of a man & he turned from me to another woman, I would kill him. & she also says I am mad, because I said I do not want to get married, as I would lose my independence..." Mrs Harland may have had relaxed views on extramarital sex, but she clearly did not like the idea of it too close to home: the next day, Grace records that "We had a big dinner party, & I had my hair waved, & it looked lovely, everybody kept telling me so, & Mrs Harland was mad, especially when Mr Harland said so, she was very jealous." It seems Grace's attractions were also noticed by another husband, for around the same time she notes "Mr Bell came to lunch, & as usual said some very idiotic remarks, making me feel very uncomfortable". The following month he makes her a present that today would be tantamount to sexual harassment, though she admits to being delighted: "I had a lovely Easter egg from Mr Bell with a lovely pair of silk stockings inside, I must not let Alice Mary know."

Clive Bell was an unusual combination of intellectual and country gentleman, the life and soul of any party, with an enormous appetite for life. He had been a compulsive womaniser since his teens, when he was seduced by a neighbour of his parents called Mrs Raven-Hill, who according to Vanessa's biographer Frances Spalding "dressed in lilac silk and black patent high-heeled shoes and, having on hand a bottle of sparkling Moselle, took his virginity, keeping up a conversational tone to ease the proceedings until his departure". But he seems to have been less serious and persistent in his attentions to Grace than the lovelorn Edgar Weller, who on April 26 "came & proposed for about the eighth time". A photograph from one of Grace's albums shows Edgar as a self-possessed young man, posing in cricket whites with a cigarette in his mouth; but he had met his match in Grace, who told him in no uncertain terms that she did not love him. Finally, in July, he gives up and tells her that he is ending their relationship: "Had a great shock. I thought I had a cheque, then when I opened the letter found it was from Edgar giving me the sack. Thank heavens." Among the other faces in the album is that of Alice Mary, a strong-jawed, rather dumpy girl who is the arch-floozy of the diary. In comparison with what her employer's circle got up to, her activities seem tame: she does not seem to have indulged in bisexual relationships, or wandered topless through the fields like Maynard Keynes's wife, the Russian ballerina Lydia Lopokova, or played charades using the words "passion" and "sodomy". But Grace is horrified by Alice's habit of "discussing Nature in an indecent & vulgar way", and adds: "I have a secret satisfaction to know that Alice's beau, did not turn up last night, I think it is wrong for her to go out with a married man, until late hours of the night..." Grace is also shocked by her behaviour at the pub near Charleston where the servants drink: "Alice it appears has been getting up into roars at the Barley Mow with a man named Ufflet, I think she has a very bad name around here." When she leaves in October, it is in typically reprehensible fashion: "Alice has gone away, but we do not weep, she has taken my ring & a pound, alas poor me..."

Occasionally the gossipy atmosphere of the kitchen becomes too much: "Every time I go out," Grace complains, "I have so many lies told about me that I dread to go out at all." But there is also plenty of boisterous good fun, and the attempts of the local lads to get into Charleston and claim a kiss are the stuff of Chaplin films. On September 23, Grace writes: "Arthur West Will White E. Kemp, Spenser Wooller call in, & started chasing me, they were a terrible nuisance.

"Last night Arthur West, White & Kemp (both soldiers) climbed Mr Grant's window & tried to get in his bedroom. I beat them out." On the following day, "Tom West told Mrs Upp he was my young man, and tried to kiss me; thereupon I called upon God to let me die, & he could not kiss me & gave it up as a bad hope." But, she adds: "Arthur West did. The Rotter. Mrs Upp so amused that she passed water, & had to go upstairs." Unlike Alice Mary, Grace knows where to draw the line, and when her reputation is threatened she acts decisively: "Tom West insulted me by saying that Edgar Weller slept with me last Easter, which was a great lie, I called his father over & told him, he very severely reprimanded Tom, who cries & came & begged my Pardon." What is curious is that while Grace records in detail these below-stairs carryings-on, she at no point alludes to the unconventional arrangements upstairs. Why should this be? Did she not consider it her place to comment on her betters' behaviour, or was there some other reason? "If she was keeping a private journal, it wouldn't have been out of awe and respect that she kept quiet about her employers," says Lucy Lethbridge, who is writing a history of servants in the 20th century. "It may simply be that the servants of the time weren't as easily shocked by what went on upstairs as we tend to imagine. As a country girl, she would have been aware of plenty of unorthodox relationships in the community where she grew up. It wasn't unusual for maids to be seduced by men of the household, though it would always be hushed up, and there was even a special name – dollymops – for servant girls who became pregnant and ended up on the streets. If Grace really had been shocked, she could simply have upped and left." In such matters, Lethbridge adds, there was often an understanding between the upper and lower classes; it was middle-class people who were more likely to take exception.

Grace's view of those upstairs is not always respectful: on September 2, 1924, she writes: "I met Mr & Mrs Leonard Woolf, rideing [sic] on their bicycles to Charleston they looked absolute freaks, Mr Woolf with a corduroy coat which had a split up the back... Mrs Woolf in a costume she had had for years." This is not to say that she disliked Virginia: during the same stay at Charleston she notes: "Mrs Woolf arrived after tea to the great joy of the household, as she is very amusing"; and in the Higgens archive is an obviously treasured postcard from the novelist, complimenting Grace on her cake-making.

Frustratingly, the diaries reveal nothing about how the sought-after housemaid finally settled for an ex-soldier called Walter Higgens: there are none at all between 1927 and 1944, when she ceased to follow Vanessa and Duncan between London, Sussex and France, and began to live at Charleston full-time as housekeeper and cook. When they resume, Grace is the mother of an eight-year-old son, and the irregular entries are chiefly concerned with mundane events – visits to the dentist and hairdresser, Home Guard darts matches. Only in 1959 does she begin to write in detail once more. By then she was in her mid-fifties, with a different status to the giddy, "quite incompetent" housemaid of the early diaries, and could be found running Charleston — which had become Vanessa's main residence — almost single-handed. She had become an excellent cook and was, says Spalding, "the mainstay of the house. Everything depended on her eventually".

Vanessa, who turned 80 that year, was in declining health. "Mrs Bell very ill," notes Grace on May 5, "gone straight to bed, finds it difficult to talk"; and then on May 6, "Doctor came to day and said Mrs Bell's heart very bad... very worried." Despite this, Vanessa, Duncan and Grace managed one more expedition to France the following January (Grace found Monte Carlo a "rather grubby place"), but by autumn 1960 Vanessa was scarcely able to leave Charleston. The following spring she contracted bronchitis. On April 7, Grace wrote: "Mrs Bell much worse, not able to move, Doctor does not expect her to live through the night, but so brave, when the doctor asked her how she was she said much better, her breathing is terrible, Ringmer nurse came this evening to help me make her bed & change her nightdress, Quentin took [his son] Julian to London & came back. Angelica coming on midnight train. Mr Grant trying so hard to keep her alive, feeding her every hour with spoonfuls of Brands extract." Later she added the single line "Mrs Bell died at midnight" and, the following day, "I shall miss her terribly."

Grace had served her mistress with devotion (and occasional exasperation) for 40 years, and this was an obvious time for her to leave a far-from-luxurious house where she had to scrub floors and endure freezing winters. But there was still Duncan — and Clive Bell, who remained a frequent visitor — to think of, so she stayed on. "I am so tired, I wish I could retire," she wrote two years later, "but I cannot leave Mr Bell & Mr Grant." Duncan was by now 78, and Clive 82. Charleston was not the hub it had been, but the names in Grace's diaries for the 1960s are impressive nevertheless: "Mr Peter Pears came for lunch and to stay the night a very nice person, he lives with Benjamin Brittain [sic] and is a very famous singer"; "Mr Edward Heath Minister for the Opposition for lunch... did not arrive till 2.30 by which time we were all famished & had started our lunches"; "L. Woolf & Peggy Ashcroft the actress (Dame) for lunch also Quentin." For many of those who came, Grace was not simply a servant but a friend. Lady Keynes, as Lydia Lopokova was now known, often dropped in for a gossip, and Grace was a guest at one of the most fashionable weddings of 1964 when Lindy Guinness married the Marquis of Dufferin and Ava. "The kitchen was very much the centre of the Charleston universe," says Vanessa's granddaughter Cressida Bell. "Everyone would end up in it. There was always a cup of tea and a 'Grace cake', which was a delicious sponge cake of her own invention. She was incredibly good-natured, and we were all very fond of her." The art historian Richard Shone remembers her "marvellous quiet voice" with a lilting East Anglian accent, and the warmth of her relationship with Duncan: "They were like equals — he would consult her over all sorts of things."

It is clear that Grace, a keen reader of biographies, had a strong sense of the importance of the people she met. In 1970, as she celebrates the 50th anniversary of her arrival in Gordon Square, a note of reminiscence creeps into her diary, as if she is keen to record things before they slip away. "Listened to the life of Marie Lloyd & remembered Walter Sickert the painter at a Dinner party in 46 Gordon Sq, singing 'My Young Man is Sitting in the Gallery'," she writes on February 11; and, the following day, "Listened to a radio scrip about Sir Frederick Ashton, Remember seeing him on a summer afternoon leaping about Charleston Lawn with red Roses threaded in his hair." When E M Forster dies, she notes: "I remember him staying here when we had a fire behind the Kitchen Wall, & the fire engine came out, he was very amused."

At the end of the year, she and Walter finally retired, buying a house in Ringmer with money from the sale of her parents' home in Norfolk. Duncan continued to live at Charleston until his death in 1978 (Clive had died in 1964), but the housekeepers who followed were not of the same calibre, and the place fell into disrepair. In his will, Duncan left Grace £300. "I did not expect it," she wrote, "as I did not think the poor dear had much money. but it is nice to be remembered... Bless him, I still cannot feel he is gone."

Grace herself died in 1983, a year after her husband. But she is not forgotten in the house she ran for so long — now open to the public. In the upstairs corridor hangs Vanessa Bell's portrait of her standing serenely over a mixing bowl, and behind the Aga is a set of tiles specially designed by Quentin Bell, a fitting tribute to a woman he described as "the guardian angel of Charleston".

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