Position Based Fluids
Words audibly exited my mouth when this GPU fluid simulation video cut to the action, but I can't be sure they were comprehensible. It was more of a surprised gasp mixed with sounds of elation, if I had to pin it down. At any rate, this is one of those watch-it-already-and-stop-reading things. Please do that now.
If your curiosity has been sufficiently piqued, go ahead and read the paper about Position Based Fluids by NVIDIA's Miles Macklin and Matthias Müller. Here's a sample: "By formulating and solving a set of positional constraints that enforce constant density, our method allows similar incompressibility and convergence to modern smoothed particle hydrodynamic (SPH) solvers, but inherits the stability of the geometric, position based dynamics method, allowing large time steps suitable for real-time applications."
While I tell myself that better-looking visuals aren't what matter, and that a solid art style ages so much more gracefully than realism ever can, it's hard not to get caught up in the excitement.