The square and straight-lined Granada Mark II was released in August 1977 (for the 1978 model year) and was produced until April 1985 following a mild facelift and attention to drivetrain noise, vibration, and harshness in 1981. The Mark II was essentially a reskin of the 1972 car, with new external panelwork that brought the Granada into line with Ford's new design language initiated by stylist Uwe Bahnsen, taking styling cues also used on the recently launched Cortina/Taunus Mk IV and Mk I Fiesta.

The engineering was very similar, the main differences being the Cologne V6 engine in 2.0, 2.3, and 2.8 L forms replacing the older Essex unit, and the introduction of features such as air conditioning and, for the top-priced 2.8-litre versions, fuel-injection.

The Granada was a strong seller in the UK, peaking in 1979 as the seventh best selling car with more than 50,000 sales, and also appearing in the top 10 for sales figures in 1978 and 1982. It remained the best selling car in this sector in Britain throughout its whole production run, despite competition from the likes of the Leyland Princess, Rover SD1 and Vauxhall Carlton.