The focus of this research was the development of the method for cloud service deployment optimisation based on the model of service and its context, with the aim of minimising the cloud service cost while fulfilling the requirements defined by the service level agreement. A cloud application context metamodel is proposed that includes parameters related to the application service and the cloud infrastructure relevant for the cost and quality of service. Through the optimisation method, the knowledge is extracted about the effects that the cloud application context parameters have on the service cost and quality of service, and the gained knowledge is further used in the deployment optimisation. The service models are validated using the implementation of cloud application services in laboratory conditions, and the optimisation method is validated using the simulations based on the proposed cloud application context metamodel. The experimental results based on selected use cases demonstrate the ability of the proposed approach to provide relevant information about the impact of cloud application context parameters on service cost and quality of service and use this information in the optimisation aimed at reducing service operational cost while preserving the acceptable level of service quality. The results indicate relevance of the proposed approach for cloud applications in the preproduction phase since application providers can gain useful insights regarding service deployment decision without acquiring extensive datasets for the analysis.