2D transition metal dichalcogenides possess fascinating properties due to their direct bandgap, strong spin-orbit coupling, and promising electronic/mechanical properties. In this work, we synthesized pure tungsten disulfide (WS2) nanolayers and NiO nanoparticles (NPs) decorated in few-layered WS2 and measured the third-order nonlinear optical properties using femtosecond Z-scan measurements. The open aperture Z-scan data illustrated that the inclusion of NiO nanoparticles into the WS2 layers increases the nonlinear absorption at 800 and 400 nm wavelengths. Furthermore, we observed the switchability of the nonlinear absorption from saturable absorption to two-photon absorption or reverse saturable absorption by changing the pump intensity. Thus, the embedded NiO NPs played a crucial role in the variation of intensity-dependent nonlinear absorption mechanism of WS2 nanolayers and thus can be helpful for various optical applications such as laser pulse compression and optical limiting to prevent over-exposure of protective photosensitive sensors by intense ultrashort laser pulses.