We present a new coupled level set and volume-of-fluid (CLSVOF) method for free surface flow simulations on an overset grid system. The coupled method takes advantages of the strengths of the level set (LS) method and the volume-of-fluid (VOF) method, and is superior to either single method. The novelty of the present method lies in that we develop the methodology for an overset grid system of embedding, overlapping and moving structured grids. The new methodology accurately captures interface and greatly preserves mass on an overset grid system by demonstrating the 3D sphere advection test. The method is coupled to a well validated Reynolds-Averaged Navier-Stokes incompressible flow solver. The method is validated with the dam-breaking flow interacting with a 3D obstacle (square structure/circular cylinder) by comparing the numerical results with available experimental and numerical studies. The water impact of a sphere case is further performed to demonstrate the capabilities of the new method on a complicated moving overset grid system. (C) 2017 Elsevier Ltd. All rights reserved.