Effective competition is the key component for the improvement of electricity market efficiency. It is necessary to establish an efficient market monitoring mechanism because of the characteristics of electricity. Market monitoring is different from regulation， and it focus on the market operation itself. Market monitoring consists of detecting the issues underlying market design and behavior of market participant， providing direction for change， decision supporting and information disclosure. A perfect market monitoring mechanism centralizing on them is presented， that is online and offline monitoring including data gathering， analysis and control. Finally， the basic principle that market monitoring need to follow is introduced.