The results of the investigations carried out on the third-order nonlinearity in zinc oxide (ZnO) nanocrystals (NCs) by Z-scan technique are included in this paper. ZnO NCs show negative nonlinearity and good nonlinear absorption behavior at 532 nm. The third-order optical susceptibility chi(3) increases with enlargement of NCs due to the size dependent enhancement of exciton oscillator strength. The synthesis of ZnO NCs was performed by laser ablation from a high-purity metallic target of Zn in distilled water medium. For the ablation process, a high frequency pulsed Nd:YAG laser was employed operating at 532 nm with 100 ns pulse duration. UV-vis absorption spectroscopy illustrated the enhancement of the size of ZnO NCs upon increasing the laser pulse energy applied in ablation process. Accordingly the corresponding optical band gap (E-g) decrease by increasing the size of NCs. X-ray diffraction (XRD) associated with transmission electron microscopy (TEM) was utilized to characterize the crystalline phase and also for determining the ZnO NCs morphology. (C) 2012 Elsevier Ltd. All rights reserved.