diff --git a/docs/generated/packages/react/generators/library.json b/docs/generated/packages/react/generators/library.json
index 35b01e811a9cab..84df21ad32adfa 100644
--- a/docs/generated/packages/react/generators/library.json
+++ b/docs/generated/packages/react/generators/library.json
@@ -185,6 +185,14 @@
         "default": false,
         "x-priority": "internal"
       },
+      "additionalImportPaths": {
+        "description": "List of additional import paths for the library.",
+        "type": "array",
+        "items": { "type": "string" },
+        "default": [],
+        "hidden": true,
+        "x-priority": "internal"
+      },
       "minimal": {
         "description": "Create a React library with a minimal setup, no separate test files.",
         "type": "boolean",
diff --git a/e2e/workspace-create-npm/src/create-nx-workspace-npm.test.ts b/e2e/workspace-create-npm/src/create-nx-workspace-npm.test.ts
index 850e2d7c6023a4..c6f5f7a5a0580e 100644
--- a/e2e/workspace-create-npm/src/create-nx-workspace-npm.test.ts
+++ b/e2e/workspace-create-npm/src/create-nx-workspace-npm.test.ts
@@ -136,6 +136,7 @@ describe('create-nx-workspace --preset=npm', () => {
     const tsconfig = readJson(`tsconfig.base.json`);
     expect(tsconfig.compilerOptions.paths).toEqual({
       [libName]: [`packages/${libName}/src/index.ts`],
+      [`${libName}/server`]: [`packages/${libName}/src/server.ts`],
     });
   });
 
diff --git a/packages/js/src/utils/typescript/ts-config.ts b/packages/js/src/utils/typescript/ts-config.ts
index e52f146a3a210f..e82590c52aa60f 100644
--- a/packages/js/src/utils/typescript/ts-config.ts
+++ b/packages/js/src/utils/typescript/ts-config.ts
@@ -59,6 +59,9 @@ export function updateRootTsConfig(
     importPath?: string;
     projectRoot: string;
     js?: boolean;
+    // For Next.js RSC users need to use deep-imports as a workaround for mixed RSC + 'use client' libraries.
+    // See: https://github.com/nrwl/nx/issues/15830
+    additionalImportPaths?: string[];
   }
 ) {
   if (!options.importPath) {
@@ -85,6 +88,17 @@ export function updateRootTsConfig(
       ),
     ];
 
+    if (options.additionalImportPaths) {
+      for (const additionalImportPath of options.additionalImportPaths) {
+        c.paths[`${options.importPath}/${additionalImportPath}`] = [
+          joinPathFragments(
+            options.projectRoot,
+            `./src/${additionalImportPath}.${options.js ? 'js' : 'ts'}`
+          ),
+        ];
+      }
+    }
+
     return json;
   });
 }
diff --git a/packages/next/plugins/with-nx.ts b/packages/next/plugins/with-nx.ts
index b0ecd6c36b6fd4..04166ca6a88f2f 100644
--- a/packages/next/plugins/with-nx.ts
+++ b/packages/next/plugins/with-nx.ts
@@ -224,6 +224,13 @@ export function getNextConfig(
   const userWebpack = nextConfig.webpack || ((x) => x);
   const { nx, ...validNextConfig } = nextConfig;
   return {
+    // Need to skip type checks for now when app layout is enabled until Next.js releases a fix.
+    // The PR is merged but unreleased.
+    // PR: https://github.com/vercel/next.js/pull/47534
+    typescript: {
+      ignoreBuildErrors: !!validNextConfig?.experimental?.appDir,
+      ...(validNextConfig.typescript ?? {}),
+    },
     eslint: {
       ignoreDuringBuilds: true,
       ...(validNextConfig.eslint ?? {}),
diff --git a/packages/next/src/generators/library/library.spec.ts b/packages/next/src/generators/library/library.spec.ts
index 7905b85fa53ead..604ebac9a22704 100644
--- a/packages/next/src/generators/library/library.spec.ts
+++ b/packages/next/src/generators/library/library.spec.ts
@@ -4,9 +4,11 @@ import { createTreeWithEmptyWorkspace } from '@nrwl/devkit/testing';
 import { Linter } from '@nrwl/linter';
 import libraryGenerator from './library';
 import { Schema } from './schema';
+
 // need to mock cypress otherwise it'll use the nx installed version from package.json
 //  which is v9 while we are testing for the new v10 version
 jest.mock('@nrwl/cypress/src/utils/cypress-version');
+
 describe('next library', () => {
   let mockedInstalledCypressVersion: jest.Mock<
     ReturnType<typeof installedCypressVersion>
@@ -133,4 +135,31 @@ describe('next library', () => {
         .jsxImportSource
     ).toEqual('@emotion/react');
   });
+
+  it('should generate a server-only entry point', async () => {
+    const appTree = createTreeWithEmptyWorkspace();
+
+    await libraryGenerator(appTree, {
+      name: 'myLib',
+      linter: Linter.EsLint,
+      skipFormat: false,
+      skipTsConfig: false,
+      unitTestRunner: 'jest',
+      style: 'css',
+      component: true,
+    });
+
+    expect(appTree.read('my-lib/src/index.ts', 'utf-8')).toContain(
+      'React client components'
+    );
+    expect(appTree.read('my-lib/src/server.ts', 'utf-8')).toContain(
+      'React server components'
+    );
+    expect(
+      readJson(appTree, 'tsconfig.base.json').compilerOptions.paths
+    ).toMatchObject({
+      '@proj/my-lib': ['my-lib/src/index.ts'],
+      '@proj/my-lib/server': ['my-lib/src/server.ts'],
+    });
+  });
 });
diff --git a/packages/next/src/generators/library/library.ts b/packages/next/src/generators/library/library.ts
index 427c9bac4f5cac..065705d5c4212a 100644
--- a/packages/next/src/generators/library/library.ts
+++ b/packages/next/src/generators/library/library.ts
@@ -33,9 +33,28 @@ export async function libraryGenerator(host: Tree, options: Schema) {
     ...options,
     compiler: 'swc',
     skipFormat: true,
+    // Always include deep import paths so users can mix server and client react components in the same library.
+    // See: https://github.com/nrwl/nx/issues/15830
+    additionalImportPaths: ['server'],
   });
   tasks.push(libTask);
 
+  const indexPath = joinPathFragments(
+    projectRoot,
+    'src',
+    `index.${options.js ? 'js' : 'ts'}`
+  );
+  const indexContent = host.read(indexPath, 'utf-8');
+  host.write(
+    indexPath,
+    `// Use this file to export React client components (e.g. those with 'use client' directive) or other non-server utilities\n${indexContent}`
+  );
+
+  host.write(
+    joinPathFragments(projectRoot, 'src', `server.${options.js ? 'js' : 'ts'}`),
+    `// Use this file to export React server components\n`
+  );
+
   updateJson(host, joinPathFragments(projectRoot, '.babelrc'), (json) => {
     if (options.style === '@emotion/styled') {
       json.presets = [
diff --git a/packages/next/src/utils/versions.ts b/packages/next/src/utils/versions.ts
index 53d0ae41f0bb64..178e529d94fad7 100644
--- a/packages/next/src/utils/versions.ts
+++ b/packages/next/src/utils/versions.ts
@@ -1,8 +1,8 @@
 export const nxVersion = require('../../package.json').version;
 
-export const nextVersion = '13.1.1';
-export const eslintConfigNextVersion = '13.1.1';
-export const sassVersion = '1.55.0';
+export const nextVersion = '13.2.4';
+export const eslintConfigNextVersion = '13.2.4';
+export const sassVersion = '1.60.0';
 export const lessLoader = '11.1.0';
 export const stylusLoader = '7.1.0';
 export const emotionServerVersion = '11.10.0';
diff --git a/packages/react/src/generators/library/lib/create-files.ts b/packages/react/src/generators/library/lib/create-files.ts
index be4ce71e1b8c9a..a4cbc128efc612 100644
--- a/packages/react/src/generators/library/lib/create-files.ts
+++ b/packages/react/src/generators/library/lib/create-files.ts
@@ -47,6 +47,19 @@ export function createFiles(host: Tree, options: NormalizedSchema) {
     host.delete(`${options.projectRoot}/package.json`);
   }
 
+  if (options.additionalImportPaths) {
+    for (const additionalImportPath of options.additionalImportPaths) {
+      host.write(
+        joinPathFragments(
+          options.projectRoot,
+          'src',
+          `${additionalImportPath}.ts`
+        ),
+        `\n`
+      );
+    }
+  }
+
   if (options.js) {
     toJS(host);
   }
diff --git a/packages/react/src/generators/library/library.spec.ts b/packages/react/src/generators/library/library.spec.ts
index e35a3946166310..fd6f5052d308a0 100644
--- a/packages/react/src/generators/library/library.spec.ts
+++ b/packages/react/src/generators/library/library.spec.ts
@@ -771,4 +771,24 @@ describe('lib', () => {
       });
     }
   );
+
+  it('should support additional import paths for RSC or testing', async () => {
+    await libraryGenerator(tree, {
+      ...defaultSchema,
+      bundler: 'vite',
+      unitTestRunner: 'vitest',
+      name: 'myLib',
+      additionalImportPaths: ['server'],
+    });
+
+    expect(tree.exists(`libs/my-lib/src/server.ts`)).toBeTruthy();
+    expect(readJson(tree, 'tsconfig.base.json')).toMatchObject({
+      compilerOptions: {
+        paths: {
+          '@proj/my-lib': ['libs/my-lib/src/index.ts'],
+          '@proj/my-lib/server': ['libs/my-lib/src/server.ts'],
+        },
+      },
+    });
+  });
 });
diff --git a/packages/react/src/generators/library/schema.d.ts b/packages/react/src/generators/library/schema.d.ts
index 1633b34d17bda9..fd0b884fd496f4 100644
--- a/packages/react/src/generators/library/schema.d.ts
+++ b/packages/react/src/generators/library/schema.d.ts
@@ -11,6 +11,7 @@ export interface Schema {
   globalCss?: boolean;
   importPath?: string;
   inSourceTests?: boolean;
+  additionalImportPaths?: string[];
   js?: boolean;
   linter: Linter;
   name: string;
diff --git a/packages/react/src/generators/library/schema.json b/packages/react/src/generators/library/schema.json
index fa7e3a82c2e45b..e0592d9de64fe6 100644
--- a/packages/react/src/generators/library/schema.json
+++ b/packages/react/src/generators/library/schema.json
@@ -188,6 +188,16 @@
       "default": false,
       "x-priority": "internal"
     },
+    "additionalImportPaths": {
+      "description": "List of additional import paths for the library.",
+      "type": "array",
+      "items": {
+        "type": "string"
+      },
+      "default": [],
+      "hidden": true,
+      "x-priority": "internal"
+    },
     "minimal": {
       "description": "Create a React library with a minimal setup, no separate test files.",
       "type": "boolean",
diff --git a/packages/storybook/src/generators/configuration/configuration.ts b/packages/storybook/src/generators/configuration/configuration.ts
index 70f25b7e5cc646..38f4c165a344fc 100644
--- a/packages/storybook/src/generators/configuration/configuration.ts
+++ b/packages/storybook/src/generators/configuration/configuration.ts
@@ -53,7 +53,7 @@ export async function configurationGenerator(
    */
 
   let storybook7 =
-    storybookMajorVersion() === 7 ?? rawSchema.storybook7Configuration;
+    storybookMajorVersion() === 7 || rawSchema.storybook7Configuration;
 
   if (storybookMajorVersion() === 6 && rawSchema.storybook7Configuration) {
     logger.error(