The school, in Pinner, Middlesex, so impressed the inspectors during their visit last year that they described the quality of teaching as "consistently high across all subjects and for pupils of all ages and disabilities".
Their report applauded the school's orderly environment and pupils' determination to reach a high standard in speaking, listening and, for those who can, in reading. The inspectors also said that standards in maths and science were "uniformly high and satisfactory, especially when pupils are investigating in familiar and unfamiliar contexts".
Standards in music and physical education are judged high, with pupils able to show they are acquiring knowledge, understanding and skills across the whole curriculum.
This is the first year that special schools have been singled out in such a way by the chief inspector and Grangewood's head, John Ayres, is unsure what criteria were used to choose the nine schools.
"Of course, we can't do formal tests and none of our children will go on to colleges or universities," he says. "When you become a teacher of children with severe learning difficulties, you are constantly being challenged by what achievement means. At Grangewood, we tend to place more emphasis on what each individual can do for him or herself."
The well-equipped school, which is divided into infant and junior departments, has 75 pupils, aged from three to 11. When they are not in the classroom, pupils can go to the sensory room where they control their environment by sound or touch. They can also roam the large playground or the sensory garden with its different textures and smells.
Parental input is important to the school. Every child takes home a diary recording each day's achievement, and weekly aims, agreed beforehand with parents, are regularly evaluated so parents can check their children's progress.
However, although the school is well resourced, thanks to vigorous fund-raising by a group of highly supportive parents and staff, it is finding it ever harder to recruit suitable teachers. The reason, says Mr Ayres, is that there are now no university courses specifically for students who want to teach children with special learning difficulties.
"In ten years' time there will be no one left to provide the quality we need," Mr Ayres says.