The move will see the former Torquay front-man join the Stags until the end of the season, as Billy Dearden's men hope to ease their relegation woes.
Gritton, 28, joined from rivals
Today's developments may spell the end of Gritton's City career, with the striker having played third-wheel to the 26-goal pairing of Jamie Forrester and Mark Stallard throughout his time here.
With the striker now off the club's wage-bill until at least the summer, manager John Schofield is said to be hopeful of securing a couple of new signings of his own to boost the Imps' promotion push, with a new striker said to feature high in the City chief's thoughts.
“Gritts has been unfortunate, but his contract is up at the end of the season and we need to give him the best possibility to get himself sorted out,” said Schofield, speaking to the club's official site.
“It also eases the burden on our wage bill when we're looking to bring new players in.
"At the moment we've got a couple of proposals on the table to players and we're just waiting to see if they're going to be accepted."
A clause in the deal means Gritton will sit-out when his new side travel to Sincil Bank on March 3.
Gritton follows fellow striker Gary Birch to the Sincil Bank exit, whose contract was terminated yesterday by mutual consent.