Composite thin films of multiwalled carbon nanotubes and BaTiO3 prepared by pulsed-laser deposition technique are investigated, which have large optical third-order nonlinearity. We characterized the films by using scanning electron microscopy, Raman spectroscopy, UV-vis absorption and X-ray diffraction. The observation reveals that the multiwalled carbon nanotubes are coated by the amorphous BaTiO3. Nonlinear optical properties of the composite films are investigated by z-scan technique. The result shows that the value of third-order nonlinear susceptibility X (3) has achieved as high as 10(-6) esu, which is more than three orders of magnitude larger than that of carbon nanotubes in suspension. (c) 2005 Elsevier B.V. All rights reserved.