Grassy Butte is an unincorporated community in southeastern McKenzie County, North Dakota, United States. It lies along U.S. Route 85, south of the city of Watford City, the county seat of McKenzie County. Grassy Butte currently has a gas station/convenience store and a bar. The elementary school has closed and the property was sold. The residents now send their children to either Killdeer, Watford City or Belfield schools.