A Monte Carlo quantum mechanical and molecular mechanical (QM/MM) simulation method using the combined Austin model 1 (AM1) and TIP3P potential is proposed to evaluate the average molecular electrostatic potentials (MEP) in aqueous solution. It was demonstrated that the average MEP in water can provide a quantitative account of the solvent polarization effect on molecular dipole moments and atomic charges. The computed induced dipole moments from the Monte Carlo AM1/TIP3P simulation method were found to be in good agreement with those predicted by continuum self-consistent reaction field theory using the AM1 and 6-31G(d) wave functions. The findings also indicate that the minimal basis set adopted by the AM1 method can capture the solvent effect effectively. Finally, good correlations in the MEP-fitted charges were obtained between different methods. These results should be useful for developing polarizable intermolecular potential functions (PIPF).