The town of Monon was platted by James Brooks in 1853 as "New Bradford". This act by the president of the New Albany and Salem Railroad (predecessor of the Monon Railroad) foretold the story of the town. The town would grow as the train company prospered, but once "The Monon" declined, so would the town's economy.
The town's name is derived from the names of two creeks nearby, the Big Monon and the Little Monon. The spelling of the name of the creeks was formerly Monong, a Potawatomi word which one authority says meant "swift-running". In the 1940s, the town's name was used as a nickname for the railroad company, and in 1956 the company formally adopted it as its corporate name. The first post office was established in 1838 under the name Monon, , and when the town was incorporated in 1879, it legally adopted the post office's name as the town's name.
The town of Monon is situated on an important junction of different branches of the Monon trains. The northern division came into Monon and turned ninety degrees heading south to Lafayette and Louisville, Kentucky. Another line comes from Indianapolis and turned east. Another line headed north to Michigan City.
In its heyday, the Monon Railroad had two train yards in Monon. The main yard was 11 tracks wide with a capacity for 270 cars. The South Yard was narrower, 5 tracks wide, but longer and had a 278-car capacity.
However, today, all passenger train services have closed, as has the line to Indianapolis and most of the line to Michigan City. The only trains through Monon now is a CSX Transportation line from Maynard, Indiana to Lafayette and another on a portion of the old Michigan City line.
There were 642 households out of which 32.7% had children under the age of 18 living with them, 50.9% were married couples living together, 12.1% had a female householder with no husband present, and 31.8% were non-families. 26.5% of all households were made up of individuals and 14.6% had someone living alone who was 65 years of age or older. The average household size was 2.70 and the average family size was 3.15.
In the town the population was spread out with 26.9% under the age of 18, 11.3% from 18 to 24, 29.4% from 25 to 44, 19.0% from 45 to 64, and 13.4% who were 65 years of age or older. The median age was 32 years. For every 100 females there were 96.0 males. For every 100 females age 18 and over, there were 93.9 males.
The median income for a household in the town was $32,235, and the median income for a family was $36,759. Males had a median income of $26,188 versus $20,405 for females. The per capita income for the town was $13,567. About 9.9% of families and 16.4% of the population were below the poverty line, including 27.7% of those under age 18 and 14.8% of those age 65 or over.
Monon was once a growing railroad town with a convergence of several railway lines carrying cargo and passengers throughout major parts of Indiana. The old 11-track yard is now just overgrown foundation.