Water-based drilling fluids (WBDF) are widely applied in oil and gas industry due to its environmental compatibility. However, the issues regarding on the fluid loss control is still a major concern in drilling fluid industry. Therefore, the introduction of nanomaterials in drilling fluids is one of the advanced approaches to solve the problems. Nanomaterials possess inherent physico-chemical properties compared to micro or macro-sized particles due to its large surface area. In this study, nanosilica particles have been selected as fluid loss control additive due to its high stability and functionality. The nanosilica particles were synthesized via sol-gel technique and the average size obtained was 70 ± 7 nm. The nanosilica was then modified using Sodium Dodecyl Sulphate (SDS) in order to produce hydrophobic particles. It was done in order to produce hydrophobic layer that can prevent fluid inflow-outflow in order to stabilize the wellbore during drilling operation by producing a filtration layer on the wall of the wellbore which overcome the fluid loss. A ratio of 50 wt% SDS/SiO2 was used and the contact angle obtained was 100 ± 8.13°. The hydrophobic nanosilica was added in the drilling fluid formulation and the performance was evaluated in terms of filter cake thickness and filtrate volume. The filter cake thickness was found less than 1 mm and the fluid loss reduction percentage was 44% for drilling fluid with hydrophobic nanosilica. Besides, the drilling fluids with hydrophobic nanosilica presented a good rheological behaviour, thermal stability and a high methylene blue capacity while the filtrates exhibited low alkalinity, low chloride ion concentration and total hardness lower than 500 mg/L.