Light-stimulated transformation of a molecule in a liquid crystal (LC) greatly affects the ordering of its nearest neighbors. At early stage of excitation this local order parameter modification is characterized with extremely short times, while a minor concentration of photo-modified molecules could contribute a lot into modulation of refractive indices of LC. Dispersion of optical activity at the edge of the selective reflection band of a chiral LC enhances significantly the nonlinear optical response. Combination of these effects has a strong potential in different aspects of optical signal processing, all-optical switching and photonics.