We demonstrate that exposure of nanoctystalline BaFCl:Sm3+ X-ray storage phosphor to blue laser pulses with peak power densities on the order of 10 GW/Cm-2 results in conversion of Sm3+ to Sm2+. This photoreduction is found to be strongly power-dependent with an initial fast rate, followed by a slower rate. The photoreduction appears to be orders of magnitude more efficient than that for previously reported systems, and it is estimated that up to 50% of the samarium ions can be photoreduced to the divalent state. The main mechanism is most likely based on multiphoton electron-hole creation, followed by subsequent trapping of the electrons in the conduction band at the Sm3+ centers. Nanocrystalline BaFCl:Sm3+ is an efficient photoluminescent X-ray storage phosphor with possible applications as dosimetry probes, and the present study shows for the first time that the power levels of the blue light have to be kept relatively low to avoid the generation of Sm2+ in the readout process. A system comprising the BaFCl:Sm3+ nanocrystallites embedded into a glass is also envisioned for 3D memory applications.