The interactive feedback between the transition of urban construction land (UCL) and rural construction land (RCL) lies at the forefront of land use transition (LUT) research, and can shape the intrinsic driving forces for land system sustainable transition and urban-rural integrated development. This study innovatively investigated the interactive feedback between UCL and RCL transition. First, a theoretical analytical framework was proposed. Second, a spatial simultaneous equation model (SSEM) was employed to examine the interactive feedback between UCL and RCL transitions in Jiangsu Province, China, from 2000 to 2020. The main findings were as follows: The interactive feedback between UCL and RCL transitions followed two paths. The first interactive feedback path was driven by the interaction of urban and rural factors, whereas the second was driven by the integrated management of urban and rural land. UCL and RCL transition witnessed a positive interactive feedback relation. Specifically, a 1% increase in UCL transition led to a 0.535% increase in RCL transition, and a 1% increase in RCL transition resulted in a 0.579% increase in UCL transition. The two aspects exhibited complex spatial interaction effects. The UCL transition in the subject city had positive and negative effects on the UCL and RCL transitions of neighboring cities, respectively. The RCL transition had positive effect on the RCL transition in neighboring cities. The key to regulation is to make the mutual feedback pathways unobstructed through innovative policies in terms of both direct and indirect regulation. This study contributes to advance research on LUT and provides scientific evidence for urban–rural integrated development.