Abstract: A method and system for performing clearance analysis of a product assembly in a computer-aided design (CAD) environment is disclosed. A method includes receiving a request for evaluating clearance between components of a product assembly in a CAD environment from a user device. The request includes a unique identifier of the product assembly. The method includes obtaining product data associated with the product assembly from a PDM database based on the unique identifier of the product assembly, and iteratively decomposing a product space including the product assembly in the CAD environment into a plurality of variable-sized partitions based on the product data. The method also includes selecting one or more variable-sized partitions for evaluating clearance between the components in the product assembly from the plurality of the variable-sized partitions, and evaluating clearance between the components in the selected variable-sized partitions.