Lost circulation material (LCM) in a variety of forms has been utilized for decades throughout the oil industry, with mixed success, as a means of curtailing fluid losses. Today with higher extraction costs and increasing wellbore complexity, there is a heightened awareness of the need to improve upon lost circulation operational practices and on the economics of drilling a well. One area the industry is focusing on more closely is wellbore stability, and with it, on bettering our understanding of lost circulation, induced fracture sealing and wellbore strengthening. These are all especially relevant in situations involving narrow drilling windows, particularly when drilling into highly depleted zones where induced fracturing and heavy losses can present a major risk. This paper will describe the application of a unique laboratory-scale fracture testing tool designed and engineered as a means of bolstering our understanding of lost circulation materials and how they seal. In turn, this led to the development of novel drilling fluid additives specifically designed to improve wellbore stability and minimize fluid losses into drilling-induced fractures and thus leading a new class of products of lost prevention materials (LPM).