The impact of heat treatment on the nonlinear optical (NLO) features of silver nanoparticle–embedded Sm3+ ion–containing glasses prepared by the melt–quench method has been investigated and discussed in detail. The NLO coefficients were assessed by the Z–scan method in the near-infrared spectral region using femtosecond, MHz laser pulses. The magnitude of different NLO coefficients, such as two–photon absorption (β) and nonlinear refractive index (n2), have been shown to be elevated with the heat treatment. Typically, at 800 nm excitation, the two–photon absorption coefficient increased from 0.816 × 10-11 m/W to 1.282 × 10-11 m/W, and the n2 values increased from 1.896 × 10-19 m2/W to 2.376 × 10-19 m2/W as the heat treatment duration was increased from 10 to 25 h. This improvement in the NLO properties was ascribed to the local field effects stimulated by the silver nanoparticles. The obtained results suggest that the investigated glasses serve as good hosts for fabricating devices such as optical switches and limiters.