I have a simple transition from black to dark grey like so:
.navbar .logo:hover {
    -o-transition: 1s;  
    -ms-transition: 1s;
    -moz-tranistion: 1s;
    -webkit-transition: 1s;
    transition: 0.2s;
    color: darkgrey;
}
Demo: http://jsfiddle.net/yD46F/10/
But when I stop hovering, it instantly turns back to black, instead of transitioning back to black, how can I fix this? Thanks!
Move your transitions to a separate CSS rule:
.navbar .logo {
    -o-transition: 1s;  
    -ms-transition: 1s;
    -moz-tranistion: 1s;
    -webkit-transition: 1s;
    transition: 0.2s;
}
The issue there is that you are currently assigning transitions to an element with pseudo-class :hover. So when the mouse moves from the element, it does not have :hover class anymore => does not have transition style properties.
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