We measured, through nearly degenerate three-wave mixing, the third-order nonlinear optical susceptibility of semiconductor doped glasses at frequencies below band gap. With typical 1.5%–5% volume fractions, the CdTe and CdS1−xSex nanocrystals give a contribution to the nonlinearity of the composite that is comparable to that of the glass matrix. The magnitude and the band-gap dependence of the nonlinear susceptibility of the nanocrystals are similar to those of the bulk semiconductors.