In this paper, the large tensile deformation and Mode-I crack propagation of hydrogel are effectively simulated by the bond-associated (BA) non-ordinary state-based (NOSB) peridynamics (PD). Based on the nonlocal theory and meshless characteristic, the fracture involving large deformation of hydrogel is solved with simple implementations. In the analysis, the Gent model is first introduced into NOSB PD as the constitutive model to describe the stress-stretch response of hydrogel under a large tensile stretch. The bond-associated scheme is applied to overcome zero-energy modes and numerical oscillation in conventional NOSB PD. Effective stretch criterion is applied to capture the crack propagation. With the explicit dynamic solver, the tensile deformation of a hydrogel sheet with a hole and the crack propagation process of a hydrogel sheet with a pre-notch under pure shear are analyzed. The predicted stress-stretch responses are in good agreement with the experimental observations, which demonstrates the effectiveness and efficiency of the developed PD approach for predicting large deformation and crack propagation of hydrogel.