We have characterized the nonlinearities observed in suspensions of carbon black particles in liquids (CBS). We have developed a preliminary explanation of the optical limiting characteristic of the CBS that qualitatively explains the low limiting thresholds. We have found that the limiting depends primarily on the input optical fluence (J/cm2) rather than irradiance (W/cm2). We have monitored transmission, side scattered light, and the photoacoustic response of the CBS simultaneously. The nonlinear scattered light appears to be the dominant nonlinearity. Additionally, we have observed that the nonlinearities disappear after repeated laser firings. Thus, in essense, we are performing a laser induced damage experiment, and we have prepared a material with a low damage threshold. These data have led us to the following model. The carbon first linearly absorbs the input light efficiently. The carbon is rapidly heated, vaporizes and ionizes to form a rapidly expanding microplasma. This plasma absorbs and scatters subsequent light, thus limiting the transmittance.