The aim of the paper is to study the capabilities of the extended finite element method (XFEM) to achieve accurate computations in non-smooth situations such as crack problems. Although the XFEM method ensures a weaker error than classical finite element methods, the rate of convergence is not improved when the mesh parameter h is going to zero because of the presence of a singularity. The difficulty can be overcome by modifying the enrichment of the finite element basis with the asymptotic crack tip displacement solutions as well as with the Heaviside function. Numerical simulations show that the modified XFEM method achieves an optimal rate of convergence (i.e. like in a standard finite element method for a smooth problem). Copyright © 2005 John Wiley & Sons, Ltd.