In this paper we evaluate the on-sky performance of Altair, the facility adaptive optics instrument at the Gemini North telescope. We describe the method for doing this on-sky evaluation, which includes: 1) the choice of suitable stellar fields for PSF observations that must cover a range of guide star magnitudes and angular separations from the guide star; 2) the observation strategy and data reduction pipeline; and 3) the PSF database from which the performance results are queried. The database stores observatory system parameters and performance observations such as FWHM, Strehl, encircled energy, wave front sensor flux, as well as coherence length (ro) and outer scale (Lo) of the turbulence measured in closed loop and therefore coincident with the focal plane observations of the telescope. From the database we derive 20 to 24% Noll efficiency of the system and an estimated distribution of effective turbulence height above the summit to be 3.3 ± 0.6km. The performance evaluation strategy used on Altair is quite general and could be used for other adaptive optics systems.