Laser excitation above the bandgap of semiconductor materials like GaAs creates a high density of electrons and holes. These quasi particles form a quantum mechanical system in which optical nonlinearities arise as a result of many-body effects such as screening of the Coulomb potential, reduction of the bandgap, and filling of the band and of the states. The refractive index change resulting from such processes may be employed to demonstrate a variety of devices such as nonlinear switches, modulators, and logic gates. These optical nonlinearities may be measured using various techniques such as four-wave mixing, interferometry, and modulation spectroscopy. In the latter technique, an analogy is established to the electroreflectance effect, in which the optical properties of a semiconductor are modulated by the application of a low-frequency electric field. In the experiment reported, the modulating element is the E-field of the pump beam. At a much higher frequency than in electroreflectance spectroscopy, the pump beam thus produces field-induced reflectance and transmittance changes from which the refractive index change is obtained. Optical Stark effect may be observed in semiconductors as the blue shift of the exciton resonance. At higher pump intensities and smaller pump detunings from the exciton, the real carrier generation, either by one- or two-photon absorption, also affects the observed spectra.