Pairs of cycloidal diffractive waveplates can be used to doubly diffract or collinearly propagate laser radiation of the appropriate wavelength. The use of a dynamic phase retarder placed in between the pair can be utilized to switch between the two optical states. We present results from the implementation of an azo-based retarder whose optical properties can be modulated using light itself. We show fast and efficient switching between the two states for both CW and single nanosecond laser pulses of green radiation. Contrasts greater than 100:1 were achieved. The temporal response as a function of light intensity is presented and the optical switching is shown to be polarization independent.