There has been growing interest in using nanomaterials to improve the comprehensive properties of polymer microspheres as plugging agents in the oil industry. Chemically functionalized graphene was prepared via water-phase direct exfoliation by cell fragmentation. The resultant graphene nanosheets were used to fabricate poly(acrylamide-acrylic acid-4-acryloylmorpholine)-based nanocomposite microspheres via in situ emulsion polymerization. Microspheres containing 0.3 wt% graphene (Graphene 0.3/terpolymer) showed high water retention and heat and shear resistance. Moreover, these microspheres exhibited improved nanomechanical properties, implying high dispersity and flowability in aqueous media. A rheology test demonstrated that the suspension of Graphene 0.3 /terpolymer behaved as a Newtonian fluid under high shear conditions, which indicated an improvement in the migration ability in the plugging process. The substantially improved comprehensive properties ensured a deep profile control and enhanced oil recovery of Graphene 0.3 / terpolymer microspheres. This research revealed that graphene can serve as a promising filler for fabricating high-performance microspheres in industry.