Molecular dynamics simulations on nanoindentation of circular monolayer molybdenum disulfide (MoS2) film are carried out to elucidate the deformation and failure mechanisms. Typical force-deflection curves are obtained, and in-plane stiffness of MoS2 is extracted according to a continuum mechanics model. The measured in-plane stiffness of monolayer MoS2 is about 182 ± 14 N m-1, corresponding to an effective Young's modulus of 280 ± 21 GPa. More interestingly, at a critical indentation depth, the loading force decreases sharply and then increases again. The loading-unloading-reloading processes at different initial unloading deflections are also conducted to explain the phenomenon. It is found that prior to the critical depth, the monolayer MoS2 film can return to the original state after completely unloading, while there is hysteresis when unloading after the critical depth and residual deformation exists after indenter fully retracted, indicating plasticity. This residual deformation is found to be caused by the changed lattice structure of the MoS2, i.e. a phase transformation. The critical pressure to induce the phase transformation is then calculated to be 36 ± 2 GPa, consistent with other studies. Finally, the influences of temperature, the diameter and indentation rate of MoS2 monolayer on the mechanical properties are also investigated.