Multi-body dynamic problems with moving boundaries are prevalent in the computational fluid dynamics. In these problems, the original mesh is unsuitable for subsequent solution steps and is needed to be deformed. The radial basis function (RBF) interpolation is a common algorithm for the mesh deformation task. However, the multi-body mesh may contain numerous individuals and volume nodes, which will harm the computational efficiency. In order to optimize this process, we propose a new method for the mesh deformation of the multi-body configuration. In this new approach, each individual is deformed separately. Thus the global problem is decomposed into a series of local mesh deformation problems. As the computational cost to construct the interpolation system in RBF algorithm is proportional to the cube of the number of support points on the surface, converting it into multiple local mesh deformation problems can effectively reduce the CPU cost. To treat each local problem, we employ a dual-restricted RBF interpolation technique which could avoid the influence of moving individual on the other individuals. This new localized approach effectively improves the computational efficiency to construct the interpolation system but sometimes will increase the CPU cost of the mesh updating procedure. To avoid this drawback, the existed multi-level restricted RBF strategy is coupled with the new localized method to further reduce the CPU cost to update the mesh. The combination of the two techniques could enhance their advantages and avoid their drawbacks. Some numerical examples have demonstrated the abilities of the new algorithm. For instance, in the case of the three-dimensional birds flock, the CPU time to construct the interpolation system and deform the volume mesh was respectively reduced by three and two orders of magnitude compared to the global single-level method.