Adds a new paragraph (13) to section 116(d) requiring that annual country human rights reports include, wherever applicable, descriptions of the nature and extent of acts of Islamophobia and Islamophobic incitement and specific elements (physical violence/harassment, propaganda, government actions, legal protections, and anti-bias education efforts).

Redesignates an existing second subsection (i) as subsection (j) and adds a new subsection (k) to require that the report required by subsection (b) include, wherever applicable, descriptions of the nature and extent of acts of Islamophobia and Islamophobic incitement (with five enumerated elements).

Amends section 102(b)(1)(A) of the International Religious Freedom Act to add a new clause (viii) requiring that the Annual Report on International Religious Freedom include, wherever applicable, an assessment and description of the nature and extent of acts of Islamophobia and Islamophobic incitement in that country during the preceding year and the government’s responses and efforts.

Adds a new section at the end of Title I of the State Department Basic Authorities Act of 1956 establishing an Office to Monitor and Combat Islamophobia within the Department of State, headed by a Special Envoy, and specifying the Office's duties and consultation requirements.