Extreme waves have led to many accidents and losses of ships at sea. In this paper, a two-dimensional (2D) hydroelastoplasticity method is proposed as a means of studying the nonlinear dynamic response of a container ship when traversing extreme waves, while considering the ultimate strength of the ship. On one hand, traditional ultimate strength evaluations are undertaken by making a quasi-static assumption and the dynamic wave effect is not considered. On the other hand, the dynamic response of a ship as induced by a wave is studied on the basis of the hydroelasticity theory so that the nonlinear structural response of the ship cannot be obtained for large waves. Therefore, a 2D hydroelastoplasticity method, which takes the coupling between time-domain waves and the nonlinear ship beam into account, is proposed. This method is based on an hydroelasticity method and a simplified progressive collapse method that combines the wave load and the structural nonlinearity. A simplified progressive collapse method, which considers the plastic nonlinearity and buckling effect of stiffened, is used to calculate the ultimate strength and nonlinear relationship between the bending moment and curvature, so that the nonlinear relationship between the rigidity and curvature is also obtained. A dynamic reduction in rigidity related to deformation could influence the strength and curvature of a ship's beam; therefore, it is input into a dynamic hydrodynamic formula rather than being regarded as a constant structural rigidity in a hydroelastic equation. A number of numerical extreme wave models are selected for computing the hydroelastoplasticity, such that large deformations occur and nonlinear dynamic vertical bending moment (VBM) is generated when the ship traverses these extreme waves. As the height and Froude number of these extreme waves are increased, a number of hydroelastoplasticity results including VBM and deformational curvature are computed and compared with results obtained with the hydroelasticity method, and then, some differences are observed and conclusions are drawn.