Flowback rate transient analysis (RTA) is a practical tool for characterizing hydraulic fracture (HF) properties. However, the accuracy of the interpreted results from flowback RTA is challenged by the complexity in two-phase flow in the hydraulic fracture and matrix system. Accordingly, we present a new semianalytical method to characterize HF attributes and dynamics using multi-phase flowback data for tight and ultratight (shale) oil wells. The proposed method includes a two-phase diagnostic plot, a fracture RTA approach for straight-line analysis, and a matrix model capable of characterizing water and oil flow. The RTA approach is based on fracture infinite acting linear flow (IALF) and boundary dominated flow (BDF) solutions, which treats HF as an open tank with a variable production rate at the well and the contribution of water and oil from matrix within the distance of investigation (DOI). The pressure-dependent fluid and geomechanical properties, such as permeability and porosity, are considered in the pseudotime defined in fracture and matrix to reduce the nonlinearity of the system. We tested the accuracy of the proposed method against numerical results obtained from commercial software. The validation results confirm that our method can closely calculate water and oil influx from matrix as well as the average pressure and saturation in the HF and matrix DOI. The accurate estimation of the initial fracture permeability and pore volume demonstrates the applicability of the proposed method in quantifying HF properties from two-phase flowback data exhibiting fracture IALF and BDF regimes. The analysis results show that the estimated initial fracture pore volume shows more accuracy than initial fracture permeability due to the different calculation sources in the straight-line analysis. In short, the proposed method is, to our best knowledge, the first RTA approach incorporating the two-phase water and oil influx from matrix into the inverse analysis of fracture properties and dynamics using straight-line analysis, instead of history matching.