Prince William and Kate observed a 72-second silence at the base of the tower in Kensington, London, in memory of the 72 men, women and children who died in the blaze five years ago.
The royal couple laid a wreath in tribute to those who died and listened to speeches which included calls for the arrests of those responsible for the tragedy and criticism of the government’s Rwanda immigration policy.
Resident Muna Hussain said her children went to the same school as five of the children who died in the fire and her household was removed from the building in the days following.
When asked about Prince William and Kate’s appearance at the service, Ms Hussain told the PA news agency: “I was happy.
“I was glad to see at least they know how we are feeling as a community and they shared that feeling.
“It makes me very happy. It’s massive, it’s huge for us. It makes you feel better.”
Ms Hussain said she witnessed the fire with her son, who was then 13 years old, and had visited the tower and memorial wall every day since they were allowed back home.
Many mourners were wearing green scarves and clothing to match the green hearts that adorn the wall and have become a symbol of the tragedy.
The duke and duchess chatted with others attending the event before taking their seats in the front row for the multi-faith service.
Their appearance followed a private meeting earlier on Tuesday with those directly affected by the disaster.
During the service, 18 green balloons were released as the names of the children who died in the fire were spoken.
There were also choir performances, prayers, readings and the unveiling of a white heart sculpture made of hands.
The service was live-streamed so the wider community and public could watch.
And grime artist Stormzy was seen close to the tower while the service took place.
Speaking on stage, Cambridge Muslim College dean Shaykh Abdul Hakim Murad called for those accountable for the fire to be arrested.
He also criticised the government’s Rwanda immigration policy and called for a “museum of inequality” to be established in the capital.
He said families “still have not heard the click of handcuffs” and criticised the “xenophobic discourse now sadly gaining ground” amid plans for deportation flights to Rwanda.
“Grenfell shows how the powerless and underestimated can suffer, but also what they can achieve,” he added, before calling for a “just closure to this story”.
Father Gerard Skinner, parish priest of St Francis of Assisi church in Notting Hill, said Grenfell Tower has become a “symbol of suffering” for those who died, their loved ones, survivors and the community, and a “symbol of shame” for liars and deceivers.
“But Grenfell is a symbol of love. It’s why the heart is there at the top [of the tower], that’s why it’s here today,” he added.
“A reminder of the love of God, God’s love for each one of us and your love for each other.
“It is a symbol of change too — of laws and of hearts.”
Eight-year-old Ayeesha, who survived the fire, recited a poem she wrote called Never Forget.
“We will stay strong, we will rise up as a community, we will fight for justice together, we will always remember our friends and our neighbours, we will always remember our home,” she said.
“We can’t change the past but we can change the future. Never forget.”
Towards the end of the service, floral tributes were laid at the base of the tower by the royal couple and Mayor of London Sadiq Khan.
The royal couple left in a black car, with Kate waving to onlookers from the back seat as they were driven down Grenfell Road.