Planning began in 1909 by the Sport Automobile et Vélocipédique de Monaco — later the Automobile Club de Monaco — at the behest of Prince Albert I. The first event, held in January 1911, saw 23 cars depart from 11 starting locations across Europe and converge on Monte Carlo. Henri Rougier, leaving from Paris on a 1,020 km route, won the event in a Turcat-Méry 25 Hp. Early judging assessed not only driving performance but also the elegance of the car and passenger comfort; controversy over the 1911 results changed nothing, and Rougier was proclaimed the winner. Before the format changed in 1997, the event was a "concentration rally" in which competitors drove from widely scattered points to Monaco before the special stages began.
Following the Second World War, works and works-supported teams became increasingly prominent. From 1949 a Team prize was awarded; the first recipients were the three Allards of Potter, Godsall, and Imhof. Subsequent team winners included Simca, Delahaye, Sunbeam-Talbot, and Jaguar. Sydney Allard won in 1952 driving his own car — the first and only winner to do so. Gatsonides competed in a factory-prepared Ford Zephyr in 1953, a year featuring no fewer than eight factory-backed Sunbeam-Talbots.
From 1953 to 1972 the rally formed part of the European Rally Championship, except in 1968 and 1969. From 1973 to 2008 it was held in January as the opening round of the FIA World Rally Championship. Between 2009 and 2011 it headed the Intercontinental Rally Challenge (IRC), a championship for naturally-aspirated four-wheel-drive cars, before returning to the WRC calendar in 2012. As recently as 1991, competitors could choose starting points from approximately five venues roughly equidistant from Monte Carlo.
The 1966 edition is the most controversial in the event's history. The first four finishers — Timo Mäkinen, Rauno Aaltonen, and Paddy Hopkirk in Mini-Coopers, plus Roger Clark's fourth-placed Ford Cortina — were all disqualified for fitting non-dipping single-filament quartz iodine headlamp bulbs instead of the standard double-filament dipping glass bulbs required on production versions of each model. The disqualifications elevated Pauli Toivonen (Citroën ID) to first place; Toivonen found the situation so embarrassing that he refused his award. Rosemary Smith (Hillman Imp) was disqualified from sixth and lost her Coupe des Dames win. In total ten cars were excluded, teams threatened a boycott, and Motor Sport ran the headline "The Monte Carlo Fiasco".
The rally's most celebrated special stage runs over the Col de Turini. The 31 km route connects La Bollène-Vésubie and Sospel via a steep mountain road with numerous hairpin turns, reaching a maximum elevation of 1,603 m at an average gradient of 6.7 %. The pass typically carries ice and snow during the January event; in 2005 Marcus Grönholm and Petter Solberg each ripped a wheel off their cars after hitting snow thrown onto the road by spectators — Grönholm finished fifth while Solberg retired with extensive damage. In the same event Sébastien Loeb set a stage time of 21 minutes 40 seconds, described as one of the fastest in the modern era. The stage is also run at night, drawing thousands of fans to what is known as the "Night of Turini" or the "Night of the Long Knives".
The Monte Carlo Historic Rally (Rallye Monte-Carlo Historique) has been held annually since 1998, one week after the main event, as a regularity rally open to cars from the 1960s through the early 1980s that previously competed in the original race. Unlike the contemporary rally it retains the concentration-rally format with multiple European departure points. The Classic Monte-Carlo Classic Rally was a classic touring rally run annually from 2017 to 2022 for cars from the 1910s through the early 1960s. The Monte Carlo E-Rally, a regularity event for alternative-fuel vehicles, has been held under various names from 1995 to 1999 and again from 2005, now running in late October as part of the FIA ecoRally Cup.
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