Gravitational potential data from GRACE are being used to study mass redistribution within and between the atmosphere, hydrosphere, cryosphere, and solid Earth. The GRACE data are made available in a reference frame with its origin at the center of mass of the Earth system (geocenter) while many other geophysical models and data sets refer to a reference frame attached to the Earth's surface. Changes in the offset between these reference frames (geocenter motion) must be accounted for when GRACE data are used to quantify surface mass changes. In this study, we developed a technique for co‐estimation of geocenter motion and gravitational potential field seamlessly from degree 1 to 90 by simultaneously inverting a set of globally‐distributed GPS displacement time series and the temporally‐varying GRACE gravity data. We found that the effect of geocenter motion was evident particularly in the GPS time series of horizontal displacements. Our estimates of geocenter motion are most consistent with the Satellite Laser Ranging (SLR) results within 1 mm in X and Z components and a submillimeter in Y component, when compared to monthly variability averaged over the period of 2003–2016. The overall magnitude of the degree‐1 (l = 1) surface mass load is estimated to be ~3 cm in equivalent water height annually migrating south‐westward from Europe (December–January) to the South Pacific (June–July). Our results also show that dense GPS network data improve water storage recovery in major river basins in the United States and Europe by contributing significantly to the recovery of higher‐degree (l ≥ ~20) geopotential coefficients.