where is the cerebrospinal fluid that surrounds the spinal cord located
It fills the central canal of the spinal cord.
Cerebrospinal fluid
CSF occupies the subarachnoid space (between the arachnoid mater and the pia mater) and the ventricular system around and inside the brain and spinal cord. It fills the ventricles of the brain, cisterns, and sulci, as well as the central canal of the spinal cord. 
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Cerebrospinal fluid [SEP] Introduction
It fills the ventricles of the brain, cisterns, and sulci, as well as the central canal of the spinal cord. There is also a connection from the subarachnoid space to the bony labyrinth of the inner ear via the perilymphatic duct where the perilymph is continuous with the cerebrospinal fluid. The ependymal cells of the choroid plexuses have multiple motile cilia on their apical surfaces that beat to move the CSF through the ventricles. A sample of CSF can be taken via lumbar puncture. This can reveal the intracranial pressure, as well as indicate diseases including infections of the brain or its surrounding meninges.