We report on the first observation of reverse saturable absorption by ferrocene (Fc) in toluene using nanosecond pulses at 532 nm. Pump and probe experiments in the visible spectral region show the existence of an excited triplet state with an intersystem crossing quantum yield S-1 -> T-1 of 0.085 and a molar extinction coefficient epsilon(T)(Fc) of 5650 L mol(-1) cm(-1) at 700 nm. The full understanding of the nonlinear optical behavior of Fc cannot be obtained, however, with a model that includes only the one-photon absorption from T-1, but it is mandatory to consider also a simultaneous two-photon absorption from an excited singlet state of Fc (two-photon absorption cross section: 2.4 x 10(-41) cm(4) s ph(-1) mol(-1)). The optical spectrum of the ground and triplet state of Fc are calculated within a TD-DFT approach considering several functionals (PBE, BLYP, LDA, OPBE) for the optimization of molecular geometry.