Amazon has recently added basic monitoring to all Amazon EC2 instances. Before this change, you had to sign-up for Amazon CloudWatch to get any monitoring. Basic monitoring allows you to view and track metrics like CPU usage, disk IO and network traffic every five minutes. To get more information, you can sign-up for Amazon CloudWatch Detailed Monitoring. This gives you data every minute for $0.015 per instance-hour.
Another feature that was recently added to CloudWatch are alarms. Using the CloudWatch API, you can use these alarms to notify you of issues or trigger auto scaling of your EC2 instances. Visit the Amazon CloudWatch page for more information.