In practical engineering, structures will inevitably suffer from multiple cracks and require accurate numerical methods to calculate the structural behavior. Regarding the multi-crack problems, the nucleation of new cracks and the development of existing cracks will affect the subsequent structural responses. Therefore, the criterion for calculating crack nucleation and development is a critical factor influencing the numerical results. This paper presents a modified Extended Finite Element Method (XFEM) to predict the nucleation and development of multiple cracks in plane members focusing on the interaction of multiple cracks. In the proposed method, the crack competition criterion is based on the minimum total energy principle, which can ensure that the nucleation and development of cracks can achieve a maximum energy dissipation per unit length. The effectiveness and robustness of the presented method are verified by comparing the numerical results with experimental and/or other numerical simulations. The result shows that the proposed competition criterion can accurately judge the sequence of new-crack nucleation and existing-crack propagation.