Graphene oxide (GO) has been evaluated as a multifunctional cross-linker or reinforcement agent in composite hydrogels. In this study, a nanocomposite hydrogel consisting of GO nanosheets and zwitterionic poly(sulfobetaine methacrylate) (PSBMA) was synthesized in an aqueous system via chemical and physical cross-linking effects. GO nanosheets were well dispersed in the hydrogels and effectively cross-linked into the sulfobetaine methacrylate (SBMA) polymer chains through the electrostatic interactions. The PSBMA hydrogel exhibited a significant enhancement in the compressive stress (close to a 5-fold increase) and a remarkable reduction in the coefficient of friction (COF) (corresponding to a decline of 52-76%) after the embedding of GO nanosheets. These improvements indicate the existence of synergetic interaction and good compatibility between GO nanosheets and the PSBMA hydrogel matrix, which results in an intertwined network structure with higher load-bearing capacity and better lubrication properties. This study provides potential in the development of new graphene-polymer composites, which is beneficial for cartilage replacement with high mechanical properties and excellent lubrication characteristics.