We report the ultrafast and large third-order nonlinear optical properties of US nanocrystals (NCs) embedded in a polymeric film. The US NCs of 2 nm radius are synthesized by an ion-exchange method and highly concentrated in the two layers near the surfaces of the polymeric film. The two-photon absorption coefficient and the optical Kerr coefficient are measured with laser pulses of 250 fs duration at 800 nm wavelength. The one-photon and two-photon figures of merit are determined to be 3.1 and 1.3, respectively, at irradiance of 2 GW/cm(2). The observed nonlinearities have a recovery time of similar to 1 ps. The two-photon-generated free carrier effects have also been observed and discussed. These results demonstrate that US NCs embedded in polymeric film are a promising candidate for optical switching applications.