The two-dimensional in-plane displacement and strain calculation problem through digital image processing methods has been studied extensively in the past three decades. Out of the various algorithms developed, the Newton–Raphson partial differential correction method performs the best quality wise and is the most widely used in practical applications despite its higher computational cost. The work presented in this paper improves the original algorithm by including adaptive spatial regularization in the minimization process used to obtain the motion data. Results indicate improvements in the strain accuracy for both small and large strains. The improvements become even more significant when employing small displacement and strain window sizes, making the new method highly suitable for situations where the underlying strain data presents both slow and fast spatial variations or contains highly localized discontinuities.