This paper is concerned with finding solutions to free-boundary inverse coefficient problems. Mathematically, we handle a one-dimensional non-homogeneous heat equation subject to initial and boundary conditions as well as non-localized integral observations of zeroth and first-order heat momentum. The direct problem is solved for the temperature distribution and the non-localized integral measurements using the Crank–Nicolson finite difference method. The inverse problem is solved by simultaneously finding the temperature distribution, the time-dependent free-boundary function indicating the location of the moving interface, and the time-wise thermal diffusivity or advection velocities. We reformulate the inverse problem as a non-linear optimization problem and use the lsqnonlin non-linear least-square solver from the MATLAB optimization toolbox. Through examples and discussions, we determine the optimal values of the regulation parameters to ensure accurate, convergent, and stable reconstructions. The direct problem is well-posed, and the Crank–Nicolson method provides accurate solutions with relative errors below 0.006% when the discretization elements are M=N=80. The accuracy of the forward solutions helps to obtain sensible solutions for the inverse problem. Although the inverse problem is ill-posed, we determine the optimal regularization parameter values to obtain satisfactory solutions. We also investigate the existence of inverse solutions to the considered problems and verify their uniqueness based on established definitions and theorems.