This work discusses a discontinuous Galerkin (DG) discretization for two-phase flows. The fluid interface is represented by a level set, and the DG approximation space is adapted such that jumps and kinks in pressure and velocity fields can be approximated sharply. This adaption of the original DG space, which can be performed 'on-the-fly' for arbitrary interface shapes, is referred to as extended discontinuous Galerkin. By combining this ansatz with a special quadrature technique, one can regain spectral convergence properties for low-regularity solutions, which is demonstrated by numerical examples. This work focuses on the aspects of spatial discretization, and special emphasis is devoted on how to overcome problems related to quadrature, small cut cells, and condition number of linear systems. Temporal discretization will be discussed in future works.interface were investigated by Babuska [2] as well as by Barrett and Elliott [3]. For the mathematical properties, that is, convergence rate and spectral properties of the matrix, the technique of interface representation should have no effect. However, especially for moving interfaces, one typically wants to avoid repetitive remeshing, leading to so-called extended finite element methods (XFEM). A very prominent work in this field, although in the domain of solid mechanics, was presented by Moës et al. [4].The present work is based on the discontinuous Galerkin (DG) method. In cells that are cut by the fluid interface, the standard DG space is extended in order to provide separate degrees of freedom (DOF) for both phases. One difficulty is that one has to integrate accurately over an interface that is only known implicitly and can have an almost arbitrary shape. This is solved by a special procedure for numerical integration, the so-called hierarchical-moment-fitting (HMF) [5] that eliminates the need for reconstructing the interface. On this basis, we demonstrate a DG method for which we can experimentally show a convergence order of approximately k C 1 for velocity and k for pressure, where k denotes the total polynomial degree of the velocity approximation. Many names for this idea seem at hand, for example, cut-cell DG or unfitted DG [6]. In reminiscence of XFEM [4], we prefer the name extended discontinuous Galerkin (XDG). While the idea seems simple at first glance, it introduces a bunch of technical difficulties, some of which are addressed in this work.This work represents the second paper in a series of publications on the road to a fully transient, 3D XDG-multiphase solver. Within the first work [5], the HMF procedure was developed. Because an XDG method like the one proposed in this work can only be 'h kC1 -accurate' if the quadrature also is sufficiently accurate, this is a necessary prerequisite for this work. For the actual work, one simplification we make is to consider only polynomial level set functions in C 1 . /. Such a choice allows us to evaluate the curvature of the fluid interface, which is required to describe the pressure jump due to sur...