Grant suffered a head injury during a practice match on January 18, 2020 and says Collingwood gave her the green light to train on February 5, according to documents filed in the County Court of Victoria on Wednesday.
Her legal representative, Margalit Injury Lawyers, alleges Collingwood's conduct was negligent and "fell below a reasonable standard of care."
They claim she has suffered injury, loss and damage as a result.
Grant, 33, retired at the end of the 2020 season after 20 games for the club.
"In the end I made the decision to put my health first," she said at the time.
The Bendigo schoolteacher joined Richmond in 2022 as an AFLW development coach.
Collingwood said its primary concern was for the health and welfare of players and staff.
"The matter has not been previously raised with the club but the fact that it is now before the courts means it is not appropriate to make any comment," it said in a statement.
Margalit Injury Lawyers has said it is also preparing a multimillion-dollar case against the AFL in the Supreme Court after numerous male and female players sustained head injuries on the field.
AFL players are currently excluded from seeking WorkCover insurance in Victoria, but the firm is pushing for an overhaul to the current workers' compensation scheme.
It comes as concerns grow about players suffering chronic traumatic encephalopathy.
The deadly neurodegenerative disease has impacted former St Kilda great Danny Frawley, Geelong legend Graham "Polly" Farmer and Richmond midfielder Shane Tuck, among others.
Since 2021, players with a medically diagnosed concussion must have a break of at least 12 days.
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