From Team Fortress Wiki
The MONOCULUS! is a headwear item wearable by all classes. It is the demonic brown eye of the Demoman that was possessed by the Bombinomicon when he was a child. The eye looks around as the player walks.
This hat is awarded to players who have earned the "Optical Defusion" achievement, by contributing to the death of the MONOCULUS that spawns in Eyeaduct during Halloween events.
This item can only be worn around Halloween or during a Full Moon; at other times of the year, it does not appear in gameplay, unless the server has Halloween mode enabled. However, it can be equipped at any time and can still be viewed on the loadout screen even when it is not visible during games.
October 27, 2011 Patch (Very Scary Halloween Special)
- The MONOCULUS! was added to the game.
September 4, 2012 Patch
- Backpack sounds updated for the MONOCULUS!