In the present work, pure and dysprosium (Dy) doped SnO2 films have been fabricated through sol-gel spin coating technique. Strong influence of Dy doping is observed on structural, morphological, vibrational, linear and nonlinear optical properties of SnO2 films. X-ray diffraction study revealed that deposited films exhibit tetragonal crystal structure with preferentially grown along (2 0 0) plane. With increase of doping concentration in SnO2, the crystallite size decreases while dislocation density and lattice distortion ratio increases. The characteristics Raman peaks of doped SnO2 thin films broaden, shifted and intensity decreases as compared to pure film which confirm the bonding between Dy and SnO2. Optical study shows that the prepared thin films are highly transparent and absorption increases with doping concentrations owing to increase of defects states. It is also observed that the optical band gap first increases and then lessens with rise of Dy-doping concentration which attributed to the Burstein-Moss (BM) effect. Additionally, dielectric constant and refractive index first decreasing with small doping concentration (1–3%) due to increase of carrier concentration, and then increases for higher doping (5–7%) due to increase of defect in SnO2 lattice. The values χ3 and β obtained by Z-scan measurement are observed in range of 0.31 × 10−7 to 1.28 × 10−7 and 1.27 to 5.32 × 10−4 cm W−1, respectively. The limiting threshold of pure and Dy doped SnO2 nanostructured films were calculated to be in the range of 5.37–11.18 kJ/cm2.