Part of the Plymouth Patent, Monmouth was first settled as Freetown in 1776-1777 by families from Brunswick. It would also be called Bloomingborough and Wales before being incorporated by the Massachusetts General Court on January 20, 1792 as Monmouth, after Monmouth, New Jersey. The name was suggested by landowner General Henry Dearborn, who had fought in the Battle of Monmouth on June 28, 1778.

In 1849, the Androscoggin & Kennebec Railroad (later part of the Maine Central Railroad) opened to the town. At that time, Monmouth was considered one of the best agricultural towns in the state, producing hay, apples and potatoes, in addition to beef cattle and dairy products. It also had excellent sites for watermills.

By 1859, when the population was 1,925, there two factories for making boot-webbing and binding, a shovel and hoe factory, a tannery, a machine shop, some mechanic shops, some wood turning shops, a sleigh and carriage factory, some boot and shoe shops, a carpet factory, and a sash, blind and door factory.