Abstract: A variety of industrial preparation methods to obtain graphene from graphite have been developed, the most prominent of which are the chemical reduction of graphene oxide and intercalation-exfoliation methods. However, the low-cost, thin-layer, large-scale production of graphene with a radial dimension smaller than 1 μm (SG) remains a great challenge, which has limited the industrial development and application of small-scale graphene in areas such as textile fibers, engine oil additives, and graphene-polymer composites. We have developed a novel way to solve this problem by improved ball milling methods which form molecular-scale grinding aids between the graphite layers. This method can produce uniform, small-size (less than 1 μm) and thin-layer graphene nanosheets at a low cost, while ensuring minimal damage to the internal graphene structure. We also show that using this SG as an additive in lubricating oil not only solves the current dispersion stability of graphene, but also reduces the friction coefficient by more than 27% and wear by more than 38.8%. The SG preparation method reported is simple, low-cost, and has a significant effect in lubricating applications, which is of great commercial value.