I find a great way to engage PC imaginations is to routinely use monsters as NPCs. The new Dungeons and Dragons 4e Chromatic and Metallic Dragons Guides have some good ideas on how to use powerful dragons as recurring NPCs and plot starters. The Monster Manual has guides for Monster stats as PCs and NPCs, to help with game mechanics. This post relates more on ideas on creating odd and memorable NPC monsters that PCs will talk about long after the campaign is one, years after.

1.) Pick A Beast
Flip through the monster manual and find a creature you have never heard of. If you have all the rule books in your bathroom and read them for hours a day while...multitasking.....you can go search old versions of monster manuals, our lovely internet, or your local library's mythology section.

2.) Give It A Personality You Know
Pick your favorite villain, hero, teacher, someone real or fictional that you know very well. This helps when you PCs do something you have not planned for. You can think, "What would my evil step sister do if someone double crossed her?". A good personality can lead to many random and most creative adventures!

3.) Name The Beast
This comes after the personality because it is easier to name something we know. That is why it is difficult to name a baby but easy to name Joe "Too Tall Joe" due to his stature.

4.) History
Tie your beast in to your campaign through politics, local legends, even a nursery rhyme. Then fill in the gaps as you go.

5.) Game Mechanics
Follow the monsters as NPCs rules, or not. Sometimes it is fun to keep players guessing. Maybe that Female Minitaur Captain seems streaky in encounters when really she just has a curse and gets a berserker frenzy during "that time of the month".

I use this as a template for NPCs aswell, I don't discriminate against any race and take all the help I can get when entertaining my PCs!

Remember use the mouths of your NPCs to describe your world. Refugees will be glad to unburden on those willing to listen, so make it worth the party's time to stop and listen. Take some time to craft a bit of scripted dialogue to add flavor to your monsters. Monsters are scenery in your world so be colorful and try to build them up as the party goes. Rummors, children's stories, tales of chance meetings all add an air of aloofness and anticipation your players will enjoy.

Example:

"Her presence is often described as tangible fear. That doesn't begin to describe the way my body shutdown the first time I met her. Muscles freezing as my heart seized, pulse beats hours apart as the air evaporated in the vacuum of her majestic malevolence. My eyes stuck open as if trying to consume the entirety of her beauty in one glance. The ruby colored scales heaving with each breath, the sound of countless treasures of log forgotten kingdoms crunching between her talons. The sheer awe of her size several leagues high and disappearing in to the cavern behind. Tendrils of smoke wafting forward from her nostrils carrying the sent of recently charred flesh."
"Then a "harrumph" and a smile, if she could smile, showing an army of pointed teeth in random rows."

Remember to work these types of narratives in to a few sessions before they actually meet the monsters. Use the players' memories to build their characters' memories.