You need to use ‘X’ and ‘Y’ in ‘Z’.
Try this:
x = linspace(-1, 1, 100);
y = linspace(-1, 1, 100);
[X,Y] = meshgrid(x, y);
a = x + 0.5;
b = y - 0.5;
Z = @(x,y) 1./sqrt(a.^2 + y.^2) - 2./sqrt(b.^2 + x.^2);
figure(1)
contour(X, Y, Z(X,Y))

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