sine qua non

Grails 1.0.x started creating a stacktrace.log file in the directory where the servlet container starts. In a development environment, using grails run-app, that’s simple enough— it appears in the top level of your application. In a production environment, this becomes a problem. Your production container (e.g. Tomcat) may start someplace where it can’t create files, like /. Thus you get exceptions sent to your container’s log files like:

java.io.FileNotFoundException: stacktrace.log (Permission denied)

Also, messages are appended to stacktrace.log– so it will continue to grow if you don’t do something about it. One option is to change where your container starts, e.g. have the startup script change to its logs directory. You can also configure your grails app to change the location of the stacktrace.log file or turn it off completely.
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To turn on display of debug log messages in Grails 1.0.2, add this to the bottom of grails-app/conf/Config.groovy:

environments {
  development {
    log4j {
      logger {
         grails."app"="debug,stdout"
      }
    }
  }
}

With Grails 1.0.3 the above will produce an error message like No such property: context for class: java.lang.String

For 1.0.3, use this:

environments {
  development {
    log4j {
      logger {
        grails {
          app="debug"
        }
      }
    }
  }
}

In your code, simply use log.debug("my message")

Thanks to the grails-user mailing list for a clue towards this.