Tuning of the dielectric permittivity spectra of iron-doped strontium titanate (SrTiO3:Fe) single crystals in an external optical field is investigated at room temperature by means of terahertz time-domain spectroscopy. Application of the optical field leads to an appreciable tuning of the permittivity, which reaches up to 3.8%. The observed behavior is interpreted in terms of soft-mode hardening due to the anharmonic character of its potential. We also find that the change of refractive index has a linear relationship on scale with the applied light power. These findings are attributed to the internal space charge field of photorefraction caused by the excited free carriers.