In recent years, low-viscosity isolation membrane acid (ISM acid) has emerged as a novel retardant acid for matrix acidizing and acid-fracturing in carbonate reservoir. Its ability to create long wormholes in carbonate rock has been extensively studied, while its potential to etch hydraulic fracture and generate conductivity has received less attention. To address the knowledge gap, a series of experiments were conducted in this study, including rheological test, acid-etching simulation experiments, surface laser scanning of acid-fractures, and conductivity tests. The differences in rheological characteristics between ISM acid, blank HCl acid, and gelled acid were compared across different lithology along with the morphology and conductivity of the etched fractures. The viscosity of ISM acid is found to be nearly identical to that of blank HCl, which is 1/26th that of gelled acid. However, the acid-rock reaction rate of ISM acid is only 46–55% compared to blank HCl acid. In dolomite formations, the rate approximates that of gelled acid but is lower in limestone formations, indicating a strong ability for low-viscosity retarding. The heterogeneity of ISM acid etching morphology approaches that of blank HCl acid but exhibits greater retard strength than gelled acid. Under medium to high closure pressure (10–30 MPa), ISM acid generates higher conductivity and better retention ability. This study provides certain guidance for the design of ISM acid fracturing in carbonate reservoir.