The　construction　industry　is　an　important　material　production　sector　and　plays　a　key　role　in　Chinese　national　economy.　However,　most　construction　companies　currently　have　low　performance.　A　literature　review　showed　that　most　research　efforts　have　been　placed　at　the　project　and　company　level,　whereas　studies　based　on　the　industry　level　are　often　neglected.　To　address　this　issue,　a　study　was　conducted　to　investigate　the　performance　of　China＇s　construction　industry　at　the　industry　level.　The　market　structure,　ownership　structure　of　the　construction　industry,　and　associated　industry　performance　under　the　market　economy　system　with　Chinese　characteristics　were　studied.　The　results　show　that　both　structure　and　performance　are　positively　correlated,　and　performance　is　more　greatly　affected　by　market　structure　than　by　ownership　structure.　This　paper　studies　the　construction　industry　performance　from　the　industrial　organization　perspective　in　China.　The　results　of　this　research　can　provide　useful　information　to　other　developing　countries　that　have　similar　structures　of　market　and　ownership.　(C)　2013　American　Society　of　Civil　Engineers.