In this paper, the nonlinear squeeze-film damping (SFD) involving rarefied gas effect in the micro-electro-mechanical-systems (MEMS) is investigated. Considering the motion of structures (beam, cantilever, and membrane) in MEMS, the dynamic response of structure will be influenced largely by the squeeze-film damping. In the traditional model, a viscous damping assumption that damping force is linear with moving velocity is used. As the nonlinear damping phenomenon is observed for a micro-structure oscillating with a high-velocity, this assumption is invalid and will generates error result for predicting the response of micro-structure. In addition, due to the small size of device and the low pressure of encapsulation, the gas in MEMS usually is rarefied gas. Therefore, to correctly predict the damping force, the rarefied gas effect must be considered. To study the nonlinear SFD phenomenon involving the rarefied gas effect, a kinetic method, namely discrete unified gas kinetic scheme (DUGKS), is adopted. And based on DUGKS, two solving methods, a traditional decoupled method (Eulerian scheme) and a coupled framework (arbitrary Lagrangian-Eulerian scheme), are adoped. With these two methods, two basic motion forms, linear (perpendicular) and tilting motions of a rigid micro-beam, are studied with forced and free oscillations.