This study aims at evaluating the performance of thiamine as a new eco-friendly shale inhibitor in water-based drilling fluids (WBDFs). The evaluation experiments include sedimentation, bentonite inhibition, filtration, zeta potential, thermal gravimetric analysis, scanning electron microscopy, X-ray diffraction, shale cuttings recovery, linear swelling and Fourier transform infrared spectroscopy (FTIR). The performance of thiamine was compared to potassium chloride. In contrast to deionized water, the aqueous solution of thiamine exhibited greater power to inhibit montmorillonite (Mt) dispersion, much more Mt loading capacity (280 g/L) and fluid loss, lower Mt mass loss, larger aggregated Mt particles, lower interlayer space of the Mt particles, less shale cuttings disintegration and lower linear swelling. Adsorption of thiamine on Mt led to a significant shift in the value of zeta potential (from −17.1 to +8.54 mV). Thiamine demonstrated superior inhibitive performance than potassium chloride. FTIR analysis confirmed that thiamine is adsorbed on Mt particles. The compatibility test revealed the compatibility of thiamine with conventional WBDF additives. It was concluded that the main probable inhibition mechanisms of thiamine are the cation exchange and Mt surface coating. In view of its prominent inhibition capacity and great environmental acceptability, thiamine is a promising inhibitor for drilling in water-sensitive formations.