In this work, the formation of the photo-induced grating and nonlinear optical properties such as diffraction efficiency (eta), refractive index modulation (Delta n), nonlinear index coefficient (n(2) ) of nematic liquid crystal (E7) doped by azo dye (Methyl Red) and C60 have been investigated by diffraction grating measurements. Diffraction efficiencies of 441 nm pump and 632 nm probe beams were measured in two-wave mixing experiment. Maximum diffraction efficiency was found 26% doped with both 1% MR and 0.5% C60, while cells without C60 had maximum diffraction efficiency of 19% under 30mW laser illumination. Rise time was found to increase with Methyl Red concentration. The nonlinear index coefficient, n(2), was calculated to be 11 x 10(-3) cm(2)/W and highly depend on MR concentration. (c) 2008 Elsevier B.V. All rights reserved.