The idea for Super Monaco GP came from Hisao Oguchi, a game planner at Sega who had grown up playing the 1979 Monaco GP. When designing a Formula One game, Oguchi chose the Super Monaco GP name after receiving feedback that it was compelling, drawing a parallel between the Monaco Grand Prix being the pinnacle of real-world motor racing and Sega's aspirations in the arcade market. The game was developed partly as a celebration of the tenth anniversary of the original Monaco GP.
The game ran on the Sega X Board system board at 60 frames per second, displayed on a 26-inch screen, and featured a Fresnel lens to make the image appear larger. Its most technically significant innovation was the inclusion of force feedback in the steering wheel — the first arcade cabinet to do so — with precision response to the player's in-game movements. The deluxe cabinet version also included Sega's "Air Drive" system, which moved the driver's seat to heighten physical immersion. Up to eight cabinets could be linked via Sega's "Power Link" cable, first demonstrated publicly at the 1988 AMOA show. All cabinet models were painted to resemble cars from the McLaren Formula One team, the team of reigning 1988 champion Ayrton Senna.
The arcade version contained parody versions of real Formula One sponsor brands. Marlboro appeared as "Marlbobo", Ford as "Fodo", BP as "BF", Honda as "Henda", FIA as "EIA", and Canon as "Conan". The game also incorporated edited Playboy imagery. In November 1989, Philip Morris contacted Sega over the Marlbobo parody following a complaint filed with the US Federal Trade Commission by a professor at the Medical College of Georgia, who argued the game was advertising cigarettes to children.
Sega agreed in March 1990 to release a conversion kit removing the offending parodies, replacing the Marlbobo branding and a Foster's parody ("Hoster's") with the Flicky logo from an older Sega arcade game. Philip Morris nevertheless sued Sega in February 1991, having also previously sued Namco over Marlboro imagery in the 1987 game Final Lap. The parties settled in May 1992. As part of the settlement, Sega ran advertisements in arcade trade publications RePlay and Play Meter offering to replace the relevant chips in existing units and pay arcade operators 200 US dollars for returning the original chips.
The arcade version presents a single race around the fictional Monaco-inspired circuit. Players complete a qualifying lap before the main event; failing to finish within 45 seconds ends the game. Qualifying performance sets the starting grid position. The race runs against 19 computer-controlled drivers, and players must maintain above a position threshold that counts down as the race progresses. Finishing in the top three unlocks a second race run in wet conditions.
Cars can be driven in automatic or 4-speed or 7-speed manual transmission. The cockpit view allocates the top fifth of the screen to a rear-view mirror effect. The Sega Genesis version added a World Championship mode featuring tracks from the full 1989 Formula One season, including Brands Hatch and Hockenheimring, with a progression system that allows the player to join better teams and receive faster cars. A password system preserves World Championship progress across sessions.
Super Monaco GP was a major commercial success in Japan and internationally. In Japan it reached second place on Famicom Tsushin's arcade earnings chart in August 1989, rose to first in September, and held that position through October. It finished as the third highest-grossing arcade game of 1989 in Japan, behind Sega's own Tetris and Namco's Winning Run, then became Japan's highest-grossing dedicated arcade game of 1990, third highest in 1991. At the 1989 Gamest Awards it received a Special Award and nominations for Best Action and Best Graphics.
Critical reception for the arcade version was strong. Computer and Video Games ranked it second among the top arcade games of 1989. A reviewer for Commodore User called it "beyond doubt the most realistic driving game I've ever played". Ayrton Senna was reportedly a fan of the coin-op, a relationship that contributed to his involvement in developing the game's sequel, Ayrton Senna's Super Monaco GP II.
The Genesis version received wide acclaim, with Mean Machines highlighting its graphics and replayability and the World Championship mode. As of mid-1994, the publication still considered it the best-reviewed driving game on the Mega Drive. Ports to 8-bit consoles and home computers received more mixed assessments, with the Master System version generally favoured and the Game Gear version criticised for being too slow and dull.