We report an experimental investigation on the origin of the large optical nonlinearity in azo-dye doped nematic liquid crystals. We show that a very large response is obtained for extremely low input light intensity, of the order of a few tens of muW/cm(2) and that it is mediated by the action of the photo-induced voltage on the specific surface coupling agent, which is an ionic surfactant. By performing circular polarization experiments we show that, during the reorientation, the nematic director follows a three-dimensional trajectory composed by in and out-of-plane motion with respect to the incidence plane of the light. We suggest that the bulk contribution is dominated by the photo isomerization of the azo-dye molecules and we report a new kind of self-sustained gratings.