If approved by the Welsh Government, the order would reduce the minimum legally required flow in the River Severn to conserve water and help protect the environment and public supply.
It would also trigger an initial five per cent reduction in water abstraction for Hafren Dyfrdwy, the local water company.
Huwel Manley, Head of Operations from NRW, said: “With a succession of intense heatwaves and record-breaking dry weather, the toll on the environment is clear for everyone to see.
“This drought order will be the latest of many measures we’ve had to take to ensure our rivers stay as healthy as they can and continue to support the ecosystems that rely on them.
“At times like this water is a precious resource.
“Every drop we waste is less water for our rivers and wildlife when they need it the most.
“We’re urging people to follow the advice of water companies and find out what they can do to use water more efficiently to help protect supply levels for people and nature.”
The Environment Agency has also applied for a related drought order for the English section of the River Severn.
Reservoirs feeding the Severn, including Llyn Clywedog and Lake Vyrnwy, are seeing rapidly declining storage levels.
The proposed drought orders aim to extend the available water supply for as long as possible, helping to avoid sudden changes in river flow that could damage the river’s ecology and harm migratory fish.
If approved, the orders could remain in place for up to six months, with the expectation that both the environment and reservoir levels will improve once normal rainfall resumes.
All of Wales remains in drought following the driest July in 190 years, with just seven per cent of expected rainfall recorded as of August 16.
Some rivers and groundwater sources have dropped to historic lows.
NRW continues to respond to environmental incidents linked to the prolonged dry weather, including dry riverbeds, fish in distress, algal blooms, and wildfires.
Officers are also conducting compliance checks to ensure abstraction licence holders are staying within their permitted limits.
The public is being encouraged to use water wisely to help protect the environment.
Advice on water-saving measures is available through the Let’s Save Water campaign, backed by regulators and water companies.
NRW also expects water companies to follow their drought plans and use Temporary Use Bans in a timely manner to protect supplies for people and the environment.