An improved volume of fluid method called the accurate density and viscosity volume of fluid (ADV-VOF) method is proposed to solve two-phase flow problems. The method has the following features: (1) All operations are performed on a collocated grid system. (2) The piecewise linear interface calculation is used to capture interfaces and perform accurate estimations of cell-edged density and viscosity. (3) The conservative Navier–Stokes equations are solved with the convective term discretized by a second and third order interpolation for convection scheme. (4) A fractional-step method is applied to solve the conservative Navier–Stokes equations, and the BiCGSTAB algorithm is used to solve the algebraic equations by discretizing the pressure-correction equation. The above features guarantee a simple, stable, efficient, and accurate simulation of two-phase flow problems. The effectiveness of the ADV-VOF method is verified by comparing it with the conventional volume of fluid method with rough treatment of cell-edged density and viscosity. It is found that the ADV-VOF method could successfully model the two-phase problems with large density ratio and viscosity ratio between two phases and is better than the conventional volume of fluid method in this respect.