This paper presents GRASP, a novel benchmark to evaluate the language grounding and physical understanding capabilities of video-based multimodal large language models (LLMs). This evaluation is accomplished via a two-tier approach leveraging Unity simulations. The initial level tests for language grounding by assessing a model's ability to relate simple textual descriptions with visual information. The second level evaluates the model's understanding of 'Intuitive Physics' principles, such as object permanence and continuity. In addition to releasing the benchmark, we use it to evaluate several state-of-the-art multimodal LLMs. Our evaluation reveals significant shortcomings in current models' language grounding and intuitive physics. These identified limitations underline the importance of benchmarks like GRASP to monitor the progress of future models in developing these competencies.