Nanographenes (NGs) have drawn extensive attention as promising candidates for next‐generation optoelectronic and nonlinear optical (NLO) materials, owing to its unique optoelectronic properties and high thermal stability. However, the weak polarity or even non‐polarity of NGs (resulting in weak even order NLO properties) and the high chemical reactivity of zigzag edged NGs hinder their further applications in nonlinear optics, thus stabilization (lowering the chemical reactivity) and polarizing the charge distribution in NGs are necessary for such applications of NGs. The fusion of heptagon and pentagon endows the azulene with the character of donor‐acceptor, and the B=N unit is isoelectronic to C=C unit. The introduction of polar azulene and BN are idea to polarize and stabilize the electronic structure of NGs for NLO applications. In the present review, a survey on the functionalization and applications of NGs in nonlinear optics is conducted. The engineering of the electronic structure of NGs by topological defects, doping and edge modulation is summarized. Finally, a summary of challenges and perspectives for carbon‐based NLO nanomaterials is presented.