In this study, we report salt-responsive amphoteric terpolymers prepared by copolymerization of acrylamide (AM), 2-acrylamido-2-methylpropanesulfonate (AMPS) and 3-acrylamidopropyl trimethylammonium chloride (ATC), and their use as rheology and fluid loss modifiers in water-based drilling fluid (WDF). The dependence of viscosity and turbidity on NaCl concentration indicates the salt-responsiveness of terpolymers, which results from salt-induced polymer conformation changes. In the presence of large quantities of NaCl, comparing with BT/polyanioins solution, bentonite (BT)/terpolymer solution has better shear thinning and thixotropic performance as well as lower fluid loss. Morphology shows that BT/terpolymer solution with NaCl creates high-quality filtrate cake which is compact and thin. A salt-resistant WDF prepared with terpolymers is evaluated and compared with polyanioinc WDF and polyanionic sulfonated WDF. The salt-resistant WDF possesses more favorable rheology, lower fluid loss and stronger tolerance for temperature, suggesting the potential use of AM/AMPS/ATC terpolymers as high-performance additives for salt-resistant WDFs.