The true currency of Gibraltar is in fact pound sterling. This is because Gibraltar is a British colony, despite its land being attached to the southern peninsular of Spain. Any money brought from the UK is accepted here and be used freely. The Gibraltarian notes, however look different to those in the UK and are not allowed to be used in the UK. Some Gibraltarians banks cater for this and have machines that issue English notes. You can also exchange the notes at any bureau de change or bank before you leave; it is more difficult to do in the UK.
Gibraltar also accepts euros but they are not always welcomed; particularly by taxi drivers. If you are using euros, inform them first. The exchange rate is usually very poor. Another common scam is to accept euros at a poor rate of exchange, and then give the change in pounds at another poor rate of exchange. This means that taxi rides often end up 50% more expensive, so beware. Shops are fine for euros though again check whether they will give euros as change.
Gibraltar also accepts euros but they are not always welcomed; particularly by taxi drivers. If you are using euros, inform them first. The exchange rate is usually very poor. Another common scam is to accept euros at a poor rate of exchange, and then give the change in pounds at another poor rate of exchange. This means that taxi rides often end up 50% more expensive, so beware. Shops are fine for euros though again check whether they will give euros as change.