Option groups on dropdown menu

Currently there's no way to do this within the form editor. You may be able to add the grouping using jQuery in your page template though.

I'm sure that's something we will add in the future. I do know it's been discussed around here as an option.

Optgroup is a feature we still plan on adding in the future. So it is on our to do list. We will never be done enhancing and refining Gravity Forms. There is no finish line.

It would be great to have this built-in, in the meantime you can accomplish it using a filter.

Add a drop down to your form but delete all but one of the options then save your form taking note of the form and field id's.

Next open up your themes functions file and paste in the following not forgetting to update the form and field ids to match the ones from your form and drop down. You will also want to edit the option values and labels (on line 5) and add in as many options and optgroups as you require.

add_filter('gform_field_content', 'modify_field', 10, 5);
function modify_field($modify_html, $field){
    if($field['formId'] == 11){
    if($field['id'] == 5){$modify_html = str_replace("<option value='First Choice' >First Choice</option>",
"<option value='' ></option><optgroup label='Swedish Cars'><option value='volvo'>Volvo</option><option value='saab'>Saab</option></optgroup><optgroup label='German Cars'><option value='vw'>VW</option><option value='audi'>Audi</option></optgroup>",$modify_html);}
	}
    return $modify_html;
}