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Water-based lubricants (WBLs) have been at the forefront of recent research, due to the abundant availability of water at a low cost. However, in metallic tribo-systems, WBLs often exhibit poor performance compared to petroleum-based lubricants. Research and development indicate that nano-additives improve the lubrication performance of water. Some of these additives could be categorized as solid nanoparticles, ionic liquids, and bio-based oils. These additives improve the tribological properties and help to reduce friction, wear, and corrosion. This review explored different water-based lubricant additives and summarized their properties and performances. Viscosity, density, wettability, and solubility are discussed to determine the viability of using water-based nano-lubricants compared to petroleum-based lubricants for reducing friction and wear in machining. Water-based liquid lubricants also have environmental benefits over petroleum-based lubricants. Further research is needed to understand and optimize water-based lubrication for tribological systems completely.