<p>This study examines the propagation of a pre-existing fluid-driven fracture in a permeable rock. Incompressible laminar Newtonian fluid drives the fracture which experiences fluid loss through the fracture interface into the surrounding rock matrix. Because the Carter’s model derived from Darcy law has its many flaws, a new model for the fluid loss relating the leak-off depth to the net fluid pressure in the fracture is employed in this work. The elasticity of the rock is modelled using the Khristianovic-Geertsma-de Klerk (KGD) model. Starting out with lubrication equations, a system of partial integro-differential equations relating the width of the fracture to the net pressure and the leak-off depth is derived. Similarity solutions derived for the fracture half-width, net pressure, and depth of leak-off are used to reduce the system of partial integro-differential equations to a system of ordinary integro-differential equations. Numerical results are obtained for the fracture length, fracture half-width, leak-off depth and the net fluid pressure.</p>