A new algorithm is developed based on the parametric variational principle for elastic-plastic analysis of Cosserat continuum. The governing equations of the classic elastic-plastic problem are regularized by adding rotational degrees of freedom to the conventional translational degrees of freedom in conventional continuum mechanics. The parametric potential energy principle of the Cosserat theory is developed, from which the finite element formulation of the Cosserat theory and the corresponding parametric quadratic programming model are constructed. Strain localization problems are computed and the mesh independent results are obtained.