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The agility of product development has already been a key factor for enterprises to win the market competition in such environment that competition is driven by customer’s demand and globalization trend is more and more obvious. The agile development of total lifecycle is a holistic concept, which interprets all development process as a generalized agile manufacturing concept, and it considers that each stage of product development lifecycle is a manufacturing process, just that the process and form displayed are different. Such agile development of total lifecycle is based on a kind of dynamic cooperation idea, and it is supported by information technology and network, which regards that the agility improvement is the focal point, and that all stages of the product development in total lifecycle reflect the cooperation idea. Furthermore, virtual organization is built to improve agility and economy of product development by dynamical uniting. The research has suggested that, in the networked environment, the small and medium-sized enterprises build virtual enterprises with the support of information technology, and utilize the superiority in integrally developing resources of virtual organization. And it can realize the goal of wholly improving product development agility by improving the agility of different stages in the product development lifecycle. During this course, the networked environment is the foundation that the virtual organization realizes the integration of the resource, normal operation and high-efficient decision. On the foundation that analyzing the characteristic of product development in the virtual organization for small and medium-sized enterprises in the networked environment, and the relation among networked, product development and decision agility, this paper proposed a basic method of product total lifecycle agile development and an framework of product development in the virtual organization in the networked environment. And it - as studied implementation process of agile product development that is based on the dynamic cooperation and oriented to the total lifecycle of products for the small and medium-sized enterprises.