A method for simulation of elastoplastic solids in multibody systems with nonsmooth and multidomain dynamics is developed. The solid is discretised into pseudo-particles using the meshfree moving least squares method for computing the strain tensor. The particle’s strain and stress tensor variables are mapped to a compliant deformation constraint. The discretised solid model thus fit a unified framework for nonsmooth multidomain dynamics simulations including rigid multibodies with complex kinematic constraints such as articulation joints, unilateral contacts with dry friction, drivelines, and hydraulics. The nonsmooth formulation allows for impact impulses to propagate instantly between the rigid multibody and the solid. Plasticity is introduced through an associative perfectly plastic modified Drucker–Prager model. The elastic and plastic dynamics are verified for simple test systems, and the capability of simulating tracked terrain vehicles driving on a deformable terrain is demonstrated.