Sea level rise (SLR) and increased urbanisation of coastal areas have exacerbated coastal flood threats, making them even more severe in important cultural sites. In this context, the role of hard coastal defences such as promenades and embankments needs to be carefully assessed. Here, a thorough investigation is conducted in Grado, one of the most significant coastal and historical towns in the Friuli Venezia Giulia region of Italy. Grado is located on a barrier island of the homonymous lagoon, the northernmost of the Adriatic Sea, and is prone to flooding from both the sea and the back lagoon. The mean and maximum sea levels from the historical dataset of Venice (1950–2023) were analysed using the Gumbel-type distribution, allowing for the identification of annual extremes based on their respective return periods (RPs). Grado and Trieste sea level datasets (1991–2023) were used to calibrate the statistics of the extremes and to calculate the local component (subsidence) of relative SLR. The research examined the occurrence of annual exceedance of the minimum threshold water level of 110 cm, indicating Grado’s initial notable marine ingression. The study includes a detailed analysis of flood impacts on the urban fabric, categorised into sectors based on the promenade elevation on the lagoon side, the most vulnerable to flooding. Inundated areas were obtained using a high-resolution digital terrain model through a GIS-based technique, assessing both the magnitude and exposure of the urban environment to flood risk due to storm surges, also considering relative SLR projections for 2050 and 2100. Currently, approximately 42% of Grado’s inhabited area is inundated with a sea level threshold value of 151 cm, which occurs during surge episodes with a 30-year RP. By 2100, with an optimistic forecast (SSP1-2.6) of local SLR of around +53 cm, the same threshold will be met with a surge of ca. 100 cm, which occurs once a year. Thus, extreme levels linked with more catastrophic events with current secular RPs will be achieved with a multi-year frequency, inundating more than 60% of the urbanized area. Grado, like Venice, exemplifies trends that may impact other coastal regions and historically significant towns of national importance. As a result, the generated simulations, as well as detailed analyses of urban sectors where coastal flooding may occur, are critical for medium- to long-term urban planning aimed at adopting proper adaptation measures.