The application of ontology in development of information systems can contribute in optimizing development process and software usage. Domain ontology contains the meta-structure for development of individual databases and applications. Ontology can be used in business analysis as a support system for proofing the established models of the business information system. Furthermore, ontology can be used as a template for optimizing the design of new system by reusing knowledge stored in its structure. During the utilization phase of an application ontology can serve as a communicator between the agents (persons and/or programs) and thus improve their interoperability. This paper contains an analysis of possibilities of using ontology in software development process. Software development is described by a few selected methodologies that are applied on several projects with Croatian government agencies, where there is an emphasized the problem of analysis and design of information systems. Such problems are common in large-scale information systems development where there exist mechanisms for their minimization and elimination. Through the ontology development of a Government agency process it was proven that it can contribute to the conceptualization of knowledge about a business area in the early stages of the development process. It has been established that the onthoology firms the notions of scope and boundaries of the observed system, ensures an efficient knowledge reuse for information systems develiopment, providing templates for a more complete integration and interaction of subsystems within a system and/or systems of different vendors (suppliers).