The Headwaters Protection Act of 2025 amends the Healthy Forests Restoration Act of 2003 to reauthorize and enhance the Water Source Protection Program. This legislation expands the definition of eligible land to include "adjacent land," encompassing non-Federal land within the same watershed as National Forest System land. It also broadens the types of entities that can participate, adding groups like acequia associations, stormwater management entities, and private water delivery authorities. The bill establishes new requirements and priorities for watershed protection and restoration projects. Projects must now protect and restore watershed health, water supply and quality, and related infrastructure, or protect forest health from threats like insect infestation and wildfire. Priority is given to projects offering risk management benefits against drought, wildfire, and extreme weather, those supporting aquatic restoration, and those involving partners with demonstrated capacity or strong likelihood of success, especially in disadvantaged communities. Furthermore, the Act facilitates a leadership role for non-Federal partners in project assessments, planning, and implementation. It clarifies that projects on adjacent land require express support from landowners and do not alter land ownership or management beyond the project's scope. Assessments must now protect and restore ecological integrity and be based on the best available scientific information. Financially, the bill significantly increases the authorized appropriation for the Water Source Protection Program to $30,000,000 annually for fiscal years 2025 through 2034, up from $10,000,000. It also modifies the non-Federal cost-share requirement to "not less than 20 percent," with a waiver option, and mandates a 10 percent set-aside for non-Federal partner technical assistance and capacity-building. Finally, the Act explicitly states that it does not supersede State or Federal water law, interstate compacts, or treaty obligations, nor does it authorize Federal acquisition or control over non-Federal land.