Aiming at the problem that the METHONTOLOGY method and the seven-step method, which are more mature than the IEEE 1074-1995 software development standard, do not consider the ontology quality assessment and its response, a new cyclic iterative ontology construction method based on demand assessment and response was proposed. First, based on the software development V-model and ontology testing framework, demand analysis for the constructed ontology was conducted, so as to define a set of ontology test design documents that emphasize meeting the demands rather than knowledge richness. Second, core architecture and architecture knowledge system were refined, and the test documents were updated. Finally, the expressions of knowledge satisfiability on the core architecture, architecture knowledge system and demand analysis were respectively evaluated by using the test documents, and the ontology was updated locally or globally when the expressions of knowledge were not satisfied. Compared with the common methods of ontology construction, the proposed method can realize the evaluation and iterative evolution in the ontology construction process. Furthermore, the government ontology established by this method not only provides a knowledge representation framework for the relevant knowledge of item transaction, but also provides a new idea for the calculation of government knowledge. And the developed government affair process optimization program based on the proposed method has successfully applied in a provincial government affair big data analysis field, so as to confirm the rationality and effectiveness of the method to a certain extent.