Bilateral obstacle problems are fundamental in the study of partial differential equations (PDEs) and variational inequalities, with significant applications in optimal control, elasticity, and material deformation under constraints. However, numerically solving these problems is challenging due to the inherent nonlinearities and the presence of free boundaries that evolve with complex contact dynamics. Conventional discretization methods, including finite element and finite difference approaches, often struggle to balance accuracy with computational efficiency, especially when dealing with irregular geometries or the need for adaptive resolution. In the present work we introduce a meshless method that overcomes these challenges by combining the modified finite-particle method (MFPM) for discretization with the Picard iteration technique for solving the result piecewise linear system. The proposed technique employs adaptive stencil selection to guarantee a result linear system with a moderate condition number. An adaptive meshless refinement method enhances the free boundary resolution, particularly in capturing the unknown free boundary a priori. Numerical experiments confirm the method’s flexibility and robustness across a range of node layouts – including Cartesian grids, PNP nodes, and Halton points – demonstrating its potential as an effective tool for solving bilateral obstacle problems and broadening the applicability of PDE and variational inequality models.
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