Employing high-yield production of layered materials by liquid-phase exfoliation, molybdenum disulfide (MoS2) dispersions with large populations of single and few layers were prepared. Electron microscopy verified the high quality of the two-dimensional MoS2 nanostructures. Atomic force microscopy analysis revealed that ~39% of the MoS2 flakes had thicknesses of less than 5 nm. Linewidth and frequency difference of the E(1)2g and A1g Raman modes confirmed the effective reduction of flake thicknesses from the bulk MoS2 to the dispersions. Ultrafast nonlinear optical (NLO) properties were investigated using an open-aperture Z-scan technique. All experiments were performed using 100 fs pulses at 800 nm from a mode-locked Ti:sapphire laser. The MoS2 nanosheets exhibited significant saturable absorption (SA) for the femtosecond pulses, resulting in the third-order NLO susceptibility Imχ((3)) ~ 10(-15) esu, figure of merit ~10(-15) esu cm, and free-carrier absorption cross section ~10(-17) cm(2). Induced free carrier density and the relaxation time were estimated to be ~10(16) cm(-3) and ~30 fs, respectively. At the same excitation condition, the MoS2 dispersions show better SA response than the graphene dispersions.