In this paper, the interaction fluid-rigid body is analysed by a finite element procedure that incorporates the arbitrary Lagrangian-Eulerian (ALE) method into a well-known two-step projection scheme. The flow is assumed to be two-dimensional, incompressible and viscous, with no turbulence models being included. The flow past a circular cylinder at Re = 200 is first analysed, for fixed and oscillating conditions. The dependence of lock-in upon the shift between the mechanical and the Strouhal frequencies, for a given amplitude of forced vibration, is illustrated. The aerodynamic forces and the wake geometry are compared for locked-in conditions with different driving frequencies. The behaviour of a rectangular cylinder (B/D = 4) at Re = 500 (based on height D) is also analysed. The flutter derivatives associated with aerodynamic damping (H-1* and A(2)* in Scanlan's notation) are evaluated by the free oscillation method for several values of reduced flow speed above the Strouhal one (namely for 3 less than or equal to U* less than or equal to 8). Torsional flutter was attained at U* greater than or equal to 5, with all the other situations showing stable characteristics. Copyright (C) 1999 John Wiley & Sons, Ltd.