Oregon Geographic Names (OGN) states that a local story about the possible origin of the name "Monitor" is that it is derived from a type of flour mill, the Monitor mill, in use in the early days of the community. In 1990, however, a descendant of one of the owners of the mill told OGN's compiler that the mill was named after the Civil Warironclad warship the USS Monitor. Furthermore, the community of Monitor did not exist until 1869, when the post office was established, and this was apparently the first use of the name for the locality. Thus, it is more likely the community was named after the ship.
Monitor is surrounded by farmland. Each spring, a tulip festival is held at the Wooden Shoe Tulip Farm about one mile north of the town center, across Butte Creek in Clackamas County.