The significance of the encounter between the USS Monitor and the CSS Merrimack (renamed the Virginia following the Confederacy's decision to secede) was the fact that it represented the first clash of ironclad naval vessels in history. Previously, warships were constructed of wood. With the advent of the Industrial Revolution and the transformation in manufacturing techniques, designs for metal ships emerged, with the Monitor and Merrimack being among the first such ships built. The Merrimack had been successfully inflicting considerable damage on northern shipping, prompting the dispatch of the Monitor to confront it. That encounter occurred on March 8-9, 1862 off the Hampton Roads region of Virginia. The arrival off Hampton Roads of Monitor succeeded in relieving the wooden-hulled northern ships, especially the USS Minnesota, and the battle that ensued between the two ironclads ended in a draw, neither succeeding in inflicting much damage on the other. The encounter would be the only such clash between the two opposing vessels, but the uniqueness of the confrontation precipitated a rush among navies in Europe to emphasize iron over wood in the construction of their warships.
The battle between the Monitor and the Merrimac (This was the ship's name when it was a US Navy ship. The CSA renamed it the Virginia) was the most famous naval encounter of the American Civil War. It is important because it showed that the era of wooden ships was coming to an end.
This battle happened in March of 1862 at Hampton Roads, VA. It was significant because it was the first time that two ironclad ships ever fought each other in a battle. Most ships of that time were made of wood. These two, however, had iron plates on their exteriors, effectively armoring them against cannonballs of the time.
This battle is mostly significant because of its impact on naval technology of the future. As the link below tells us, the battle
convinced naval experts around the world that the era of the wooden warship was over. It also persuaded the North to use its vast factories and shipyards in the production of additional ironclad ships. As these vessels were put into service, the Union was able to further strengthen its control of the seas.