Gruger was inducted into the Society of Illustrators' Hall of Fame in 1981. A biographical citation is here. David Apatoff posted a series of articles about Gruger here, here, here, here, here and here and, as usual, makes excellent observations. Another worthwhile Web page dealing with Gruger is here.
This seems to have been done entirely in pencil.
It seems to be dealing with ghosts from different eras and places.
Gruger also used watercolor or lampblack washes.
Note how sketchily done most objects are here. The viewer will therefore probably focus on the two faces and maybe the girl's knee.
Perhaps a speakeasy nightclub scene. Compare to Henry Raleigh's party scenes. Different styles, but equally compelling. Makes me wish I was there.
More lightly done than many of his illustrations.
Yes, Gruger also could do color. This is a scan from Benjamin B. Pearlman's biography of Gruger, "The Golden Age of American Illustration: F.R. Gruger and His Circle" North Light Publishers, 1978. The image in the book was itself scanned from a copy of the magazine because the original art could not be found. Therefore, the quality is not good and the color might have shifted due to aging of the magazine page.
The Kelly site dates this as 1903 (as of the time I captured the image), but 1925 should be a better estimate. The publication image is below. But might this actually be the presumably lost original? Although the colors differ (they seem thinner here, for one thing), examination of the line work, shading, and other details show that it is the same as the final version. Could colors have been altered during printing preparation?
I like this illustration a lot due to the delineation quality -- the variation in line weights and such. The remarks for the first scan, above, also apply here. Moreover, both images have been slightly cropped.