Industrial Reinvestment and Defense Diversification Act of 1992 - Prohibits funds appropriated or made available by the Congress from being obligated or expended to maintain U.S. bases in North Atlantic Treaty Organization member countries if the countries do not enter into an agreement or agreements with the President to provide for the payment, in the aggregate (in the form of money or real or personal property), of at least one-half of the cost of maintaining and compensating U.S. armed forces stationed in such countries.

Requires the President to report to the Congress describing any agreement reached pursuant to this Act.

Ceases the prohibition on such obligation and expenditures of funds if an agreement is entered into after the prohibition takes effect and if the President submits a report to the Congress which describes the agreement.

Establishes the Industrial Reinvestment and Defense Diversification Fund. Requires the Secretary of the Treasury to transfer quarterly to such Fund all NATO country payments to be credited to the Defense Cooperation Account under this Act. Transfers appropriated funds for operations and maintenance of U.S. military bases in Europe which are suspended by this Act from the Defense Cooperation Account to the Fund.

Directs the Secretary of the Treasury to determine the aggregate amount of funds deposited to the Industrial Reinvestment and Defense Diversification Fund and to make such amount available for expenditure according to a specified formula for purposes including general assistance, energy research and development, and urban mass transit.

Directs administrative agencies to formulate regulations to expedite consideration of grant applications for programs receiving increased appropriations pursuant to this Act by any State, county, or local government: (1) experiencing a level of unemployment greater than the national average, or (2) which has been determined to be substantially and seriously affected due to realignment or closure of a military installation or defense facility, or cancellation or curtailment of a major defense contract.