I just wanted to share some notes on fishing on Grand Cayman from my recent experience there in case it helps anybody else out in the future. This refers to shore fishing only - there are lots of charters and guides you can hire, and you can probably even rent your own boat, but I strictly stuck to fishing from the shore.
since the focus of the island seems to be around tourist activities like snorkeling, diving, cruise ships and beaches, I didn't see any bait or tackle shops (though the yellow pages in my room listed a few places you could probably get tackle) and no fishing piers so I would highly recommend bringing everything you need with you. I opted to bring my own two piece rods, reels, and a small tackle bag with everything I thought I would neeed which I checked at the airport.
You will also probably want to rent a car in order to explore and get to the different locations - the only other way to get around would be taxis or buses - which are actually more like vans and not buses. I am not sure how carrying your gear with you would work in those situations. They drive on the left hand side of the road here, so be prepared for that.
As I mentioned, I couldn't find any bait shops, but I heard that I could get squid at the grocery store. I figured it would be food grade squid, but the grocery store actually had a frozen section with fishing bait. They had ballyhoo ready for rigging, 10, 5, and 2 pound boxes of squid and various whole fish which you could use for cut bait. I did not see any shrimp. The grocery store I found bait at was Foster's Food Fair and there is another grocery store called Kirk's.
Basically - as long as you are practicing catch and release you can fish anywhere on the island with no license required. There is one spot where no fishing is allowed, but I think you can only reach it by boat. Private locations may have thier own rules - for example the Rum Point pier had a no fishing sign, but that was the only one I saw on the island.
The only zone you are not allowed to fish in is the Environmental Zone in the map above. Here are all the regulations - http://www.caymannewresident.com/fishing.
The most challenging part was finding a good place to fish from shore without affecting other tourist activities. There are a number of public beaches around the island - the most popular being 7 mile beach on the western end. This beach was extremely crowded and I would not recommend fishing there with so many people. The first place we actually fished from was the public beach and pier near the Kittiwake Wreck dive site on the West End. We fished from the dock, but this proved to be annoying as every 30 minutes a dive boat would dock and we would have to move out of the way. Managed to catch French Grunts, Dusky Damselfish and Sergeant Majors under the dock before we decided to try another location.
Typical Shoreline in Grand Cayman
Sergeant Major and Dusky Damselfish
We ended up at another boat ramp on the northern side of the island at Old Man Bay - this was the only location I saw any other people fishing the entire time I was on the island. Some locals were fishing the flats and a local boat came in while we were there with serious fishing equipment. There were shark fins hammered into the dock - I didn't get a picture, but it was very strange. The area here was grass flats mixed with rocks so there was an abundance of species. We caught some French Grunts and a nice sized Barracuda. I have never seen a Barracuda jump before. It broke the line while we trying to get it on the dock so we did not get a picture. We also caught Blue Runners, Schoolmasters, Mahogony Snappers, and Blue Striped Grunts. There was also an eel living in a tire under the dock that completely ignored everything I tried to entice it with.
Schoolmaster and Blue Runner
On the final day we went to Smith Cove (Smith Barcadere) which is a public beach, cove and reef. However, you can walk past the beach onto the rocks up the shore and fish from the rocks away from the snorkelers and swimmers. It is very rocky and 10-15 feet above the water. There were dozens of reef species here but the wrasse's were the most agressive. we caught Puddingwife's, Slippery Dicks (by the dozen), Blue Head Wrasse, Sergeant Major's, Bermuda Chubs, French Grunts and Red Band Parrotfish.
I saw at least two dozen other reef species that I did not manage to catch while snorkeling. The diversity is pretty amazing. Another note - there are tarpon everywhere. They are fed everyday by tourists all along the coast. There are spots inches from shore where there would be 20-30 tarpon. Again, fishing in these tourist spots would be strange and I certainly didn't want to catch a human fed tarpon, nor did I have the gear for it. But just wanted to point out if anybody goes that there are tarpon all over the place. Hopefully these notes and location can help somebody in the future. It was fun figuring some of it out!