Monterey is a southern Owen county town near the Kentucky River on Cedar Creek. The area was settled around 1805 by James and Alexander Williams and the site was first known as Williamsburg. A Mouth of Cedar Creek post office opened in 1817 and was renamed Cedar Creek in 1825 and might have moved to the site of the town at that time. In 1847 it was renamed Monterey for the Mexican War battle. The post office has since closed. The population in 1990 was 164.