Water Rights Protection Act of 2023 This bill addresses issues of water rights with respect to lands under the jurisdiction of the Department of the Interior and the Department of Agriculture, including water rights of federally recognized Indian tribes. Specifically, such departments must ensure that federal action imposes no greater restriction or regulatory requirement than under applicable state water law. Further, such departments shall not take actions that adversely affect state authority in permitting water usage or in adjudicating water rights. The bill also prohibits such departments from requiring water users to transfer water rights to the United States or acquire water rights in the name of the United States as a condition of issuing or renewing a land use or occupancy agreement.