Loss circulation is considered as a time-consuming, costly, and challenging issue while drilling or cementing jobs, which ought to be treated and resolved promptly. The choice of a treatment that quickly plugs the loss zone and helps to restore the circulation is critical. Cross-linkable polymer gels play a significant role in mitigating drilling fluid loss, but controlling the gelation time and pumpability are the main challenges of these gels. This research aims to evaluate a novel smart fluid that has high flexibility in design. The shear sensitive fluid (SSF) is an oil-based fluid containing a polymer, gelation agents, and multi-crosslinkers. After passing through the drilling bit, the SSF is crosslinked with time to produce a high strength gel. The designed shear sensitive fluid is one of the possible solutions for severe loss circulation.The overall purpose of this research was to scrutinize the gelation behavior and SSF performance as a smart lost circulation treatment, which was followed in two sections including experimental analysis and empirical modeling. The effect of various factors including the type of crosslinker, shear rate, emulsifier concentration, temperature, shear history, salinity, etc. on the performance of the formed gels was studied. Furthermore, the maximum sealing pressure of formed gels in the highly permeable porous medium and fractured core as well as the probability of formation damage was evaluated.In order to determine the correlations required to predict the ultimate gelation time of SSF, the response surface methodology was utilized according to the central composite design. The considerable values of correlation coefficients (R2 = 0.91) prove the validity of estimated models for the fit enough responses with the experimental data. For the designed SSFs, depending on the operating conditions, the appropriate gelation time can be adjusted by emulsifier concentration and shear rate values. Also, the minimum gelation time and the highest crosslinking rate occur approximately at the shear rate of 45,000 1/s. At high shear rates, the effect of temperature on the functionality of the formed gels decreases, which is due to the high rate of crosslinking. Based on dynamic sealing pressure tests, the SSFs have a high potential in mitigation of lost circulation during drilling. The maximum sealing pressure was measured above 1000 psi in highly permeable porous medium and up to 600 psi in fractured core, which indicate the high strength of the formed gels against drilling fluid pressure. The designed SSFs could be easily removed from reservoir by 15 vol% hydrochloric acid, indicating the non-damaging properties of the formed gels.