In this study, we investigate the discontinuous-derivative treatment at the gas-liquid interface in underwater explosion (UNDEX) problems by using the Moving Least Squares-Smoothed Particle Hydrodynamics (MLS-SPH) method, which is known as one of the particle methods suitable for problems where large deformation and inhomogeneity occur in the whole domain. Because the numerical oscillation of pressure arises from derivative discontinuity in the UNDEX analysis using the standard SPH method, the MLS shape function with Discontinuous-derivative Basis Function (DBF) that is able to represent the derivative discontinuity of field function is utilized in the MLS-SPH formulation in order to suppress the nonphysical pressure oscillation. The effectiveness of the MLS-SPH with DBF is demonstrated in comparison with the standard SPH and conventional MLS-SPH though a shock tube problem and benchmark standard problems of UNDEX of a trinitrotoluene (TNT) charge.