A meshfree method and (the related) a specified crack growth algorithm are used to simulate plugging fracture during high-speed impacts. In particular, we are simulating ballistic penetration of a steel plate, which is a ductile failure process involving projectile and target collision, contact, and subsequent projectile penetration companied plugging fracture inside steel plate. We have developed and implemented an explicit meshfree Galerkin formulation, which is capable of capturing ductile fractures during finite inelastic deformation. The developed meshfree computational procedure has the following features: (1) it has an effective dynamic meshfree contact algorithm that is suitable for high-speed impact; (2) it can deal with thermal–mechanical couplings, and the stability of coupled thermal–mechanical motion is guaranteed by an adiabatic split algorithm that integrates adiabatic heating and heat diffusion separately; (3) it has an automatic crack growth algorithm that can simulate the whole lifespan of crack growth including crack nucleation, propagation and arrest; (4) to compute the rate-dependent material responses, a modified forward Euler tangent algorithm is adopted in constitutive update process for the nonlinear thermal–mechanical inelastic constitutive relation that takes into account damage evolution. Results of a numerical simulation of plugging fracture due to projectile/target impact are presented, and they compare well with experimental data.