Nuclear Facility and Material Security Act of 2008

Nuclear Facility and Material Security Act of 2008 - Directs the Nuclear Regulatory Commission (NRC) to issue a final rule requiring: (1) all commercial nuclear power reactors approved for construction after enactment of this Act to be designed to withstand a large commercial aircraft impact; and (2) certain spent fuel security enhancements.

Directs the NRC to issue an Independent Spent Fuel Storage Installation security final rule that: (1) makes such installations subject to specified security evaluation requirements of the Atomic Energy Act of 1954; and (2) incorporates such installations into a certain design basis threat rule.

Requires the NRC to consider the likely consequences of a potential terrorist attack in any review it is required to undertake under the National Environmental Policy Act of 1969.

Amends the Public Health Security and Bioterrorism Preparedness and Response Act of 2002 to repeal the statement that certain requirements to make potassium iodide tablets available to state and local governments for stockpiling shall cease to apply if the President determines that there is an alternative and more effective prophylaxis or preventive measures for adverse thyroid conditions that may result from the release of radionuclides from nuclear power plants.

Vests the Secretary of Health and Human Services with all federal authority over the distribution of potassium iodide as a medical prophylaxis for radiological exposure in humans.

Directs the Secretary to arrange with the National Academy of Sciences (NAS) for studies on appropriate emergency response plans to nonroutine releases of radioactive materials, including from nuclear power plants, spent fuel storage facilities, radiological dispersal devices, and improvised nuclear explosive devices.

Directs the Secretary to establish guidelines for the stockpiling and distribution of potassium iodide tablets in the event of a nuclear incident.

Amends the Energy Reorganization Act of 1974 to establish within the Office of the Inspector General of the NRC a unit with appropriate and adequate technical staff with nuclear power plant experience to audit NRC regulatory oversight regarding civilian nuclear facilities.

Amends the Atomic Energy Act of 1954 to require the NRC to promulgate final rules governing radiation source protection measures.

Directs the NRC to publish final rules: (1) revising regulations on security requirements for transportation of radiation sources; (2) requiring carriers and transporters transporting radiation sources within the United States to be licensed by the NRC; (3) revising National Source Tracking System regulations to require technologies and systems that can provide real-time tracking and enable locating of specified radiation sources; and (4) establishing requirements leading to the replacement of all high-risk radiation sources.

Authorizes appropriations for the acceptance, storage, and disposition of high-risk radiation sources by the Department of Energy United States Radiological Threat Reduction Program.