The Hammers put in a fantastic defensive display at the Emirates in the Premier League clash with their London rivals but were undone by an 88th minute header from Alex Song which sealed a 1-0 victory for the home side.
It is a result which means West Ham remain bottom of the table, but Grant was taking the positives and praised the fighting spirit from his team.
He told Sky Sports: "I think we played well today. We played against a very good team and I think they only had two chances to score.
"We also did some things on the counter-attack and then they scored in the last moment.
"But I'm very proud of the players after what they did today. They showed a lot of good things, fighting spirit and tactical understanding.
"Unfortunately they scored in the last moment, it happens."
Goalkeeper Robert Green was in top form to produce some impressive stops and keep Arsenal at bay.
Following his World Cup disaster the under-pressure shot-stopper will be delighted to get a good display under his belt, and Grant was happy with the whole backline.
"He is a good keeper, he did a good job today. All the defence did a good job today," he added.
"They closed the spaces well. It is not easy to play against Arsenal and we did do well.
"I don't remember Arsenal not able to create so many chances in a long time, this is because of the whole team.
"We can take a lot of positive things from this game even though we lost.
"I feel that we are doing the right things and everything is getting better and better.
"I'm sure that we can do it (climb off bottom). I think the next month or two months are very important for us because we need some points.
"But if we continue to play like this we will have points."
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