Will Mountain Lion's Time Machine read data from a NAS and back it up to an external USB drive? So, I have most of my data on a NAS. 

Can I configure time machine to backup both my iMac's internal drive as well as my data stored on a NAS? All of the backups are to be stored on an USB drive attached to my iMac.

I'm running Mountain Lion. The NAS I have is here:

http://www.buffalotech.com/products/network-storage/home-and-small-office-nas/linkstation-pro-duo-1

I'm not sure which protocol I'm using right now, but it supports AFP.
While Time Machine always backs up all mounted volumes connected to the Mac via USB/FireWire/Thunderbolt, it can't backup network volumes like a NAS.

As it seems, this is not mentioned anywhere in Apple's support documents, but here's a good Time Machine FAQ made by a user.