AbstractThe dual particle dynamic (DPD) methods which employ two sets of particles have been demonstrated to have better accuracy and stability than the co‐locational particle methods, such as the smooth particle hydrodynamics (SPH). The hybrid particle method (HPM) is an extension of the DPD method. Besides the advantages of the DPD method, the HPM possesses features which better facilitate the simulation of large deformations. This paper presents the continued development of the HPM for the numerical solution of two‐dimensional frictionless contact problems. The interface contact force algorithm which employs a modified kinematic constraints method is used to determine the contact tractions. In this method, both the impenetrability condition and the traction condition are simultaneously enforced. In the original kinematic constraints method, only the former condition is satisfied. A new formulation to find stress derivatives at stress‐free corners by imposing stress‐free boundary conditions is also developed. The results for 1‐D and 2‐D contact problems indicate good accuracy for the contact formulation as well as the corner treatment when compared to analytical solutions and explicit finite element results using the commercial code LS‐DYNA. Copyright © 2004 John Wiley & Sons, Ltd.