When they first got together they originally wanted each TV show to have a different name, so people would not be able to find the show on TV, or would not know what to expect.
They came up with all sorts of strange titles for the shows like Owl Stretching Time and so on.
One of the possible titles they came up with for a show was Monty Pythons Flying Circus.
Eventualy this name was given to the whole team.
Some of the strange titles were still used in the first series of Monty Python, see here
http://www.pythonland.com/episode04.php