Abstract: A contact algorithm based on an extended finite element method (XFEM) is established, which is able to simulate the adhesion, slide and separation of a contact interface. The results of an example for a plane frictional problem demonstrate that the performance on describing the contact behavior of this algorithm is almost identical to that of a conventional interface element. The results of an example on the shear band in a plane strain sample demonstrate that this algorithm can reflect the dissipation mechanism of a frictional contact reasonably and therefore avoid the phenomenon of zero energy dissipation and then be able to describe the strain localization in the plane strain sample.