How to stay happy in a house where such a MIL exist?

Let me make one thing clear we can’t leave the house. We (me, my husband n 3yrs old son) stay together in a joint family with my Mother-in -law and father-in -law. My brother-in-law n her wife stays out of city coz of their jobs. They come home fortnightly or whenever feasible for them. My MIL likes my brother-in-law more than my hubby coz of his sweet nature. My hubby is straightforward. She portrays us as we don’t take care of her to all especially my BIL.. She also is now starting creating misunderstanding within me n my BIL’s wife. I don’t know how to remain calm n happy in such an environment. I want to live just for my son n hubby n want to ignore her, help me out to keep her off my mind n stay in light mood. She modifies anything I say n pes it to my BIL n SIL. I m working though I do all the household chores, take care of her meals n also my son who always seeks my attention. Suggest me how to divide my time or schedule so as I pay full time required by my son n hubby. My MIL always creates misunderstandings between two brothers. My BIL is trying to get transferred n then I guess the problems will increase further coz this politics which works only twice or thrice will continue everyday the.