How can I get System Monitor Indicator to display temperature?

System Monitor Indicator is quite simple / flexible. You can add basically any script as custom sensor. The output it produces will then appear where you put its placeholder. I am using this to extract information from the output of sensors like this:

sensors | grep temp1 | awk '{print $2}' | sed 's/+//' 

to exctract the temperature or

sensors | grep fan1 | awk '{print $2}'

to extract the fan speed.

Just click on New, enter a name and a description and the respective lines from above under Command as shown here:

PS: After upgrading from Ubuntu 12.04 to 14.04 the tool seemed to have problems to read the configuration file, resulting in a crash when I tried to add sensors. Removing .indicator-sysmonitor.json from my home directory fixed this.

There's an indicator for the temperature in this ppa:

sudo add-apt-repository ppa:alexmurray/indicator-sensors
sudo apt-get update
sudo apt-get install indicator-sensors

It’s already updated with packages for saucy, although I haven't tried it myself since I'm still using 13.04. You can then launch it from the dash or from the command-line and configure to show different sensors and set up alarms.