Godshill is one of the oldest parishes that existed before the making of the Domesday Book, the first written spelling being Godeshulle. The church was given by William Fitz-Osbern, who died in 1070, to the Abbey of Lyra in Normandy.
In 1090, Richard de Redvers, Lord of the Island, gave the Manor of Appuldurcombe, which comprised the best part of the parish of Godshill, to the Abbey of Montebourg in Coutances, Normandy. It was originally a small priory of Benedictine monks, situated a short distance from the present ruin.
The house and lands came to the Worsley family through the marriage of Anne, daughter of Sir John Leigh to Sir James Worsley. In 1557, Dame Anne willed 20 marks for erecting a free Grammar School in Godshill but this was never built and the old Chantry Priest's House continued to be used. In 1824 the old school was pulled down, the Old Vicarage built in its place and the school rebuilt in its present position by Lord Yarborough and restored in 1848 as a misappropriated Grammar School under a scheme of the Charity Commissioners.
Stenbury Manor, originally surrounded by a moat was the seat of the de Aula family soon after the Norman Conquest. It was pulled down and rebuilt in the 16th century and the moat was filled in during 1727.
Godshill has many listed buildings, the majority being Grade 2 but All Saints Church, Godshill is Grade 1. A further smaller manor in Sandford is one of the many valuable manors owned by the king in 1086.
All Saints Church dates largely from the 14th century and is the fourth on this site. Sir John Oglander, historian of the 17th century, says in his memoirs that the first church "wase bwylt in ye rayne of King Edward the Confessor".
All Saints is renowned for its mid-15th century mural of the Lily Cross. Painted over during the Reformation, it was rediscovered in 1842.
Godshill church has a peal of six bells. They were recast in 1887 from the old peal which had been recast in 1815 with the village gun of 1543 being cast into the tenor bell.
The cluster of cottages by the church are thought to have been built in the 15th century, possibly to house the masons rebuilding the church. The Old Bell was once the Bell Inn and continued as a public house until the late 1920's; Church Hill Cottage was a smallholding with dairy produce being sold from a room at the front; whilst Church Gate Cottage may have been the Sexton's cottage.
The present Hill Cottage was originally four labourers' cottages but became an antique/show cottage between the wars. Queen Mary visited on a regular basis and took tea at Essex Cottage. Hill Cottage is no longer a listed building.
Tea rooms have long been a standard attraction in Godshill with charabanc trips. Another royal visitor was Princess Beatrice bringing her daughter, Queen Ena of Spain to the Griffin, also for tea.
The railways arrived in 1875 but stopped running through Godshill in 1952 when the Merstone to Ventnor West line was closed under Dr Beeching.
In August 1968 the first IW Festival was held at Ford Farm, attended by 10,000. On a stage constructed of two trailers, acts such as Jefferson Airplane and T Rex performed. It was considered the first great UK rock festival, even though only running for one day.