During the past decade there has been an increasing interest in the nonlinear behavior of gas bubbles in liquids. Recent papers by Soviet investigators [e.g., Kustov et al., Sov. Phys. Acoust. 32(6), 500–503 (1986)] have concentrated on phenomena observed when sound interacts with a bubbly layer. These phenomena can include acoustic solitons, parametric radiation, self‐focusing, phase conjugation, and other effects that occur because the system is highly nonlinear. An investigation of the acoustic nonlinear parameter of mixtures was conducted to help infer the volume fractions of the mixture components. When a bubbly medium of known air volume fraction is considered as a two‐component mixture, its effective nonlinear parameter may be calculated using mixture methodologies [R. Apfel, J. Acoust. Soc. Am. 74, 1866–1869 (1983)]. The mixture analysis in this work, which is independent of any assumptions regarding bubble oscillation, yields nonlinear parameter values comparable to those of the Soviet investigators. For certain volume fractions, values of the nonlinear parameter of a bubbly liquid may be hundreds of times that of either the gas or the liquid host. Both experimental and theoretical work will be presented and the implications of this enhanced nonlinearity will be discussed. [Work supported by NIH through Grant 5‐R01‐GM30419.]