Labor will be forced to negotiate with the Greens to pass its plan to extend the Murray-Darling Basin Plan timeline and open it up to buybacks.
Water Minister Tanya Plibersek introduced the legislation to the parliament on Wednesday, which will be sent to a Senate inquiry for further scrutiny.
The Coalition will oppose any move to buy back more water, leaving the Greens holding the balance of power in the Senate.
Greens water spokeswoman Sarah Hanson-Young said although the bill had a number of positives, her party would vote down the legislation unless it was amended to include a guarantee that the 450 gigalitres of environmental water will be recovered by the new 2027 deadline.
Unlike the other water targets within the basin plan, the 450GL has no legislative consequences - such as forced buybacks - if the goal is not met.
"There's no requirement that the 450GL previously promised to South Australia for the health of the river will actually be delivered," Senator Hanson-Young said.
"It could be after the next election. That is so long away. We need to make sure that the health of the river is restored now."
Ms Plibersek said there was no way of achieving the 450GL of additional environmental water without passing the legislation.
"Right now there are legislative blocks to delivering that water - this legislation removes those blocks...this does what the Greens are asking for," she said.
Labor's bill will be put under the microscope of a Senate inquiry. Coalition water spokesperson Perin Davey wants the committee to travel to towns within the Murray-Darling Basin, to hear first-hand how water buybacks will affect communities.
Ms Plibersek stressed water buybacks would not be the government's "first tool at hand", but it had to be one of them.
"Voluntary water purchases are not the government's first choice, but they need to be on the table if we're serious about meeting these Murray-Darling Basin Plan targets," she said.
National Farmers' Federation chief executive Tony Mahar said the proposal would blow up the Basin Plan, destroying trust and livelihoods in basin communities.
"The plan that was brokered a decade ago included clear limits on the harm that could be inflicted on basin towns - government ministers stood in these communities and made promises about those limits," he said.
"Successive governments have managed to maintain a fragile consensus on the basin plan across party lines and between the states and territories. This Bill will blow up that consensus for a cheap political win."
Mr Mahar said the hundreds of pages of the bill boiled down to one simple change.
"What this bill does is remove every last limit on the government's power to shut down farms," he said.
"It allows the Minister to shut down as many farms as she wants, to destroy as many jobs as she wants, and to spend as much as she wants in the process.
"It's a blank cheque Parliament would be mad to sign."
Nationals leader David Littleproud said Labor introduced the MDBP in 2012, then-Water Minister Tony Burke put in place socio-economic criteria to prevent regional communities from being hurt by environmental water buybacks.
"Tanya Plibersek is tearing up Tony Burke's bill," he said.
"Water buybacks are blood instruments that hurt regional Australia, but this government doesn't care even though they put in place a mechanism to protect us."
NSW Irrigators' Council chief executive Claire Miller said more water would solve the environmental issues the basin was facing, such as cold water pollution, poor water quality and the invasive carp infestation.
"The new Basin Plan is solely about delivering an election promise to South Australia," Ms Miller said.
"As the nation grapples with a cost-of-living crisis, the government is effectively asking consumers to foot the bill to shore up seats in Adelaide."