<?xml version="1.0"?>
<ownershipDocument>

    <schemaVersion>X0306</schemaVersion>

    <documentType>4</documentType>

    <periodOfReport>2018-06-15</periodOfReport>

    <notSubjectToSection16>0</notSubjectToSection16>

    <issuer>
        <issuerCik>0000067625</issuerCik>
        <issuerName>MONMOUTH REAL ESTATE INVESTMENT CORP</issuerName>
        <issuerTradingSymbol>MNR</issuerTradingSymbol>
    </issuer>

    <reportingOwner>
        <reportingOwnerId>
            <rptOwnerCik>0001232891</rptOwnerCik>
            <rptOwnerName>LANDY SAMUEL A</rptOwnerName>
        </reportingOwnerId>
        <reportingOwnerAddress>
            <rptOwnerStreet1>3499 ROUTE 9 NORTH, SUITE 3D</rptOwnerStreet1>
            <rptOwnerStreet2></rptOwnerStreet2>
            <rptOwnerCity>FREEHOLD</rptOwnerCity>
            <rptOwnerState>NJ</rptOwnerState>
            <rptOwnerZipCode>07728</rptOwnerZipCode>
            <rptOwnerStateDescription></rptOwnerStateDescription>
        </reportingOwnerAddress>
        <reportingOwnerRelationship>
            <isDirector>1</isDirector>
            <isOfficer>0</isOfficer>
            <isTenPercentOwner>0</isTenPercentOwner>
            <isOther>0</isOther>
            <officerTitle></officerTitle>
            <otherText></otherText>
        </reportingOwnerRelationship>
    </reportingOwner>

    <nonDerivativeTable>
        <nonDerivativeHolding>
            <securityTitle>
                <value>Monmouth Real Estate Investment Corporation</value>
            </securityTitle>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>250927.482</value>
                    <footnoteId id="F1"/>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>D</value>
                </directOrIndirectOwnership>
            </ownershipNature>
        </nonDerivativeHolding>
        <nonDerivativeHolding>
            <securityTitle>
                <value>Monmouth Real Estate Investment Corporation</value>
            </securityTitle>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>24907.497</value>
                    <footnoteId id="F2"/>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>I</value>
                </directOrIndirectOwnership>
                <natureOfOwnership>
                    <value>Held By Spouse</value>
                </natureOfOwnership>
            </ownershipNature>
        </nonDerivativeHolding>
        <nonDerivativeHolding>
            <securityTitle>
                <value>Monmouth Real Estate Investment Corporation</value>
            </securityTitle>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>22379</value>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>I</value>
                </directOrIndirectOwnership>
                <natureOfOwnership>
                    <value>Sam Landy Family Ltd Partnership</value>
                </natureOfOwnership>
            </ownershipNature>
        </nonDerivativeHolding>
        <nonDerivativeHolding>
            <securityTitle>
                <value>Monmouth Real Estate Investment Corporaiton</value>
            </securityTitle>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>53000</value>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>I</value>
                </directOrIndirectOwnership>
                <natureOfOwnership>
                    <value>Co-Manager of EWL Grandchildren Fund LLC</value>
                </natureOfOwnership>
            </ownershipNature>
        </nonDerivativeHolding>
    </nonDerivativeTable>

    <derivativeTable></derivativeTable>

    <footnotes>
        <footnote id="F1">Includes 87.611 shares acquired through dividend reinvestment on 6/15/2018, and 70,195.391 shares held in 401(k) as of 6/2018.</footnote>
        <footnote id="F2">Includes 81.296 shares acquired through dividend reinvestment on 6/15/2018.</footnote>
    </footnotes>

    <ownerSignature>
        <signatureName>Nelli V. Madden</signatureName>
        <signatureDate>2018-06-19</signatureDate>
    </ownerSignature>
</ownershipDocument>
