Source monitoring is an unconscious mental test that humans perform in order to determine if a memory is "real" and accurate as opposed to being from a source like a dream or a movie. People use many sources to determine the source of a memory or idea. People use physical information about people and objects such as determining that the person they see walking towards them is their longtime friend and not a character from a movie. People use linguistic and categorical information as well.
External source monitoring focuses on sources that are in an individual's environment. An example of this would be recalling which one of your professors gave an exam yesterday.
Internal source monitoring is focused on internal factors like when an individual is distinguishing between something they said outloud and something they thought to themselves.
Source monitoring errors can occur for many reasons such as brain injury, aging, depression, cognitive biases. They are memory errors in which a specific recalled experience is falsely attributed to be the source of a particular memory. An example of a source monitoring error would be incorrectly recalling a conversation that occurred in a dream as reality.