In the generic formulation of optical interactions there is, beyond the familiar electric and magnetic multipolar forms of coupling, an additional diamagnetization term that rarely receives attention. In fact it can give rise to effects that should be observable in the general context of nonlinear optical spectroscopy, as well as scattering. A quantum electrodynamical analysis reveals features of special interest in two specific cases: two-photon absorption and Rayleigh scattering. Diamagnetic contributions are seen to be dispersion free with regards to the frequency of input radiation, and can represent unique interactions within optical absorption and emission processes. There is also a configuration in which diamagnetic couplings, which are quadratic in the magnetic field, can supersede those that are dependent linearly on the electric field strength, such as the electric dipole. In this connection the influence of retroreflected circularly polarized light, which leads to a local distance dependence in magnitude of the electromagnetic fields, produces conditions in which the diamagnetization response can become a prominent feature in two-photon absorption.