Encountering mud cake is a natural consequence of the drilling operation in oil and gas wells. Thick mud cake requires extra drilling efforts to remove it. Thick cake increases filter loss, reduces wellbore space and causes drill pipe stuck. This study aims at enhancing the performance of the water-based bentonite by using drilling mud hydrophilic, smart nano clay to modify the rheological properties and reduce the thickness of the mud cake. Hydrophilic, smart nano clay is used to enhance water-based mud performance. The content of the bentonite is varied between 2 to 8 by weight of water and the temperature is varied between 25°C to 85°C. The nano clay particle size is increased by 1 starting from 12 to 20 nm in order to modify the rheological properties and, hence reduce the cake. The samples are hydrated and their pH is adjusted. Viscometer FANN 35SA is used to measure the rheological properties of all samples under standard conditions. The thickness of the cake is measured using MITUTOYO Vernier Caliper. As a matter of fact, by using the nanoparticle water-based mud, it can reduce the mud cake thickness by approximately 56.25. However, the filtrate volume surprisingly increased by 89 as compared to the collected volume with ordinary clay, Determinant coefficients for the base fluid and nanofluid were found at 87 and 96, respectively, which are close to the best-fitted lines. The average base fluid and nanofluid were found at 0.23657 and 0.12225 inches, respectively. The standard deviation of the base fluid is 0.08229, indicating that approximately 8.2 of the base fluid is data points deviate from the mean. The value of the nanofluid is 0.02363, indicating that approximately 82 percent of the base fluid's data points deviate from the average value. When compared to normal clay, the rheological characteristics, gel strength, and filtrate volume of nano clay show a negative influence on drilling fluid performance and deviate from the API standard specifications. The values for PV, YP and gel strength indicate a high slope trend, however, the filtrate volume collected shows a decreasing slope trend. Results prove that the proposed nanoparticle water-based mud works and has reduced the cake thickness by nearly half compared to the ordinary clay. The Hydrophilic smart nano clay introduced here is a new technology. Resources of the material are available in nature and can be obtained with ease and low cost. This investigation outcome is based on solid experimental results and can be implemented in the field without extra efforts or the need for scale-up. Copyright © 2022, Society of Petroleum Engineers.