In this paper we introduce a novel parallel and interactive SPH simulation and rendering method on the GPU using CUDA which allows for high quality visualization. The crucial particle neighborhood search is based on Z-indexing and parallel sorting which eliminates GPU memory overhead due to grid or hierarchical data structures. Furthermore, it overcomes limitations imposed by shading languages allowing it to be very flexible and approaching the practical limits of modern graphics hardware. For visualizing the SPH simulation we introduce a new rendering pipeline. In the first step, all surface particles are efficiently extracted from the SPH particle cloud exploiting the simulation data. Subsequently, a partial and therefore fast distance field volume is rasterized from the surface particles. In the last step, the distance field volume is directly rendered using state-of-the-art GPU raycasting. This rendering pipeline allows for high quality visualization at very high frame rates.