I'm just wondering what the best solution for monitoring internet browsing history would be for a small school with 1 server.

for free you could use a squid proxy server...it's free, it's not that easy to set up if you've never done it...but it's free...there are even pre-configured virtual appliances (for VMWare or VMWare server) that you can download for free and run in a VM

you could also get a barracuda networks WebFilter appliance...it's a hardware based webfilter that can track usage (to a point) as well as do content filtering (to help automatically block things you don't want) it can even do application blocking (to block things like chat programs and P2P software)...i've got the model 310 here at work and i love the thing...they've got a 210 model that's a bit cheaper but with a few less features (and built for smaller usage)....it's virtually plug and play

I'll the squid proxy server, thanks for your work.

You could try Endian. http://www.endian.com/ You can download it for free and use it. But the free version comes with no support and updates. It's open source and most of the content filtering engines out there are using the same thing that endian is.