This paper presents an improved Nearest Neighboring Particle Searching (NNPS) technique for numerical modeling of water waves with the Smoothed Particle Hydrodynamics (SPH) method. The proposed technique differs from others by introducing the concept of Inner and Outer Particle Searching (IOPS) and shifting most of advanced CPU operations into simple addition operations. The IOPS method is shown to significantly improve the computational efficiency and reduce the CPU time especially for large number of particles, based on comparisons with other two NNPS methods. This method is implemented in a 2DV numerical wave flume conducted by the SPH method. Three test cases are examined, including generations and propagations of dam-breaking induced waves, solitary wave and irregular wave. Calculated results are in good agreements with experimental data and theoretical solutions with fairly satisfactory CPU time-consuming. The wave motions observed in physical facilities are successfully reproduced by the SPH numerical wave flume, revealing its robust capability of modeling realistic wave propagation and substantial potential for a wide variety of hydrodynamic problems.