Fuchsine Basic dye-polyvinyl alcohol composite films were fabricated and their structure, nonlinear absorption as well as linear absorption and photoluminescence properties were investigated. Switchover from saturable absorption to two-photon assisted excited state absorption with increase in intensity was observed in the open aperture Z-scan study (Nd:YAG, 532 nm, 7 ns). The effective two-photon absorption coefficient beta was found to be several orders higher than that reported for rhodamine B. The dye-polymer films were characterized as nanocomposites with dye microdomains encapsulated between molecules of the amorphous polymer and having average surface roughness as low as approximate to 0.46 nm. The samples also exhibited intense photoluminescence emission when excited with 534 nm radiation. (C) 2011 Elsevier B.V. All rights reserved.