An improved meshfree method that considers cracking, contact behaviour and fluid–solid interaction (FSI) was developed and employed to shed light on the progressive failure of the water-resistant stratum and inrush process in a karst tunnel construction. Hydraulic fracturing tests considering different scenarios and inrush events of the field-scale Jigongling karst tunnel in three scenarios verify the feasibility of the improved meshfree method. The results indicate that the brittle fracture characteristics of the rock mass are captured accurately without grid re-meshing by improving the kernel function of the meshfree method. The complex contact behaviour of rock along the fracture surface during inrush is correctly captured through the introduction of Newton’s law-based block contact algorithms. FSI processing during inrush is accurately modelled by an improved two-phase adaptive adjacent method considering the discontinuous particles without coupling other solvers and additional artificial boundaries, which improves computational efficiency. Furthermore, the improved meshfree method simultaneously captures the fast inrush and rock failure in the Jigongling karst tunnel under varying thicknesses and strengths of water-resistant rocks and sizes of karst caves. As the thickness and strength of water-resistant rock increase, the possibility of an inrush disaster in the tunnel decreases, and a drop in the water level and an increase in the maximum flow velocity have significant delayed effects during the local inrush stage.