Ontology as the hot point in information field, it is always discussed and researched widely in the academic area. The research of converting thesaurus to ontology is going on for many years. In this paper, we mainly discussed the relationship between thesaurus and ontology, and the application of thesaurus in building ontology. The four essential elements relating to ontology research are also mentioned. They are terms, hierarchy between terms, semantic network and reasoning ability. We explored the method of building ontology based on thesaurus, in order to offer some useful reference for building ontology.