We have investigated resonant two-photon absorption and second harmonic generation in a microcavity geometry. In a single beam arrangement, the transmission depends on the intensity according to a simple two-level picture with an intensity-dependent coupling; at resonance, in particular, the system exhibits a two-photon Rabi splitting. In a pump and probe arrangement, the presence of the strong incident pump beam substantially modifies the absorption spectrum of the weak probe beam: for moderate pump intensities the behaviour can be interpreted as a two-photon version of the well-known optical Stark effect. At higher intensities, more complicated hyper-Raman processes take place, which give also rise to gain in well-determined spectral regions. Finally, we have shown how the non-linear coupling coefficient appearing in the model Hamiltonian is related to the material constants and geometrical parameters of a specific microcavity configuration. IntroductionIn the last few years great attention has been focussed on the exploitation of light confinement effects in order to enhance the strength of the light±matter interaction. Linear optics in the strong-coupling regime between a photonic mode and an excitonic mode in a microcavity geometry [1] has been much studied. On the other hand, nonlinear optical effects still deserve further investigation. For instance, coherent saturation effects for excitonic transitions [2] and low-intensity optical switching [3] have been considered. The present paper contains a brief report of the nonlinear optical effects which can occur in a microcavity system when resonant second harmonic generation (SHG) or two-photon absorption (TPA) processes take place. Further details will be found in [4].