Interest in using nanomaterials to improve shale stability during drilling operations has been increasing. Herein, a polymer microsphere emulsion (PME) as a high-performance shale stabilizer for water-based drilling fluids (WDFs) was prepared via emulsion polymerization. The particle sizes in PME in aqueous solution ranged from 90 to 320 nm. PME was found to exhibit excellent salt tolerance and temperature resistance. The plugging performance of PME was tested through pressure transmission tests. The results indicated that the polymer microspheres in PME could effectively plug shale pores and reduce shale permeability. In addition, rolling recovery tests were used to evaluate the shale hydration inhibition performance of PME. It was found that PME showed great performance for decreasing shale hydration potential. These factors make PME a promising shale stabilizer for WDFs used to drill shale formations.