High-performance water-based drilling fluids (HPWBFs) are essential to wellbore stability in shale gas exploration and development. Laponite is a synthetic hectorite clay composed of disk-shaped nanoparticles. This paper analyzed the application potential of laponite in HPWBFs by evaluating its shale inhibition, plugging and lubrication performances. Shale inhibition performance was studied by linear swelling test and shale recovery test. Plugging performance was analyzed by nitrogen adsorption experiment and scanning electron microscope (SEM) observation. Extreme pressure lubricity test was used to evaluate the lubrication property. Experimental results show that laponite has good shale inhibition property, which is better than commonly used shale inhibitors, such as polyamine and KCl. Laponite can effectively plug shale pores. It considerably decreases the surface area and pore volume of shale, and SEM results show that it can reduce the porosity of shale and form a seamless nanofilm. Laponite is beneficial to increase lubricating property of drilling fluid by enhancing the drill pipes/wellbore interface smoothness and isolating the direct contact between wellbore and drill string. Besides, laponite can reduce the fluid loss volume. According to mechanism analysis, the good performance of laponite nanoparticles is mainly attributed to the disk-like nanostructure and the charged surfaces.