Abstract: Vehicular Adhoc Networks (VANETs), a subset of Mobile Adhoc Networks (MANETs), refers to a set of smart vehicles used for road safety. This vehicle provides communication services among one another or with the Road Side Unit (RSU). Security is one of the most critical issues related to VANET as the information transmitted is distributed in an open access environment. As each vehicle is not a source of all messages, most of the communication depends on the information received from other vehicles. To protect VANET from malicious action, each vehicle must be able to evaluate, decide and react locally on the information received from other vehicles. Therefore, message verification is more challenging in VANET because of the security and privacy concerns of the participating vehicles. To overcome security threats, we propose Monitoring Algorithm that detects malicious nodes based on the pre-selected threshold value. The threshold value is compared with the distrust value which is inherently tagged with each vehicle. The proposed Monitoring Algorithm not only detects malicious vehicles, but also isolates the malicious vehicles from the network. The proposed technique is simulated using Network Simulator2 (NS2) tool. The simulation result illustrated that the proposed Monitoring Algorithm outperforms the existing algorithms in terms of malicious node detection, network delay, packet delivery ratio and throughput, thereby uplifting the overall performance of the network.