In this paper a novel simulation technique is presented to perform Direct Numerical Simulation (DNS) of fluid flow and heat transfer in dense fluid-particle systems. The unique feature of our fluid-solid coupling technique is the direct (i.e., implicit) incorporation of the boundary condition (with a second-order method) at the surface of the particles at the level of the discrete momentum and thermal energy equations of the fluid. Contrary to lattice Boltzmann or other commonly used immersed boundary implementations, our method does not require using any effective diameter. A fixed (Eulerian) grid is utilized to solve the Navier-Stokes equations for the entire computational domain. Dissipative particle-particle and/or particle-wall collisions are accounted via a hard sphere discrete particle approach using a three-parameter particle-particle interaction model accounting for normal and tangential restitution and tangential friction. Following the detailed verification of the method several dense multi-particle systems are studied in detail involving stationary arrays of particles and fluidized particles. (C) 2012 Elsevier Ltd. All rights reserved.