The irradiance threshold for femtosecond optical breakdown in aqueous media is approximately equals 1.0x1013W cm-2. At the breakdown threshold, a plasma with a free electron density of about 1021cm-3 is generated, and the energy density in the breakdown region is sufficiently high to cause the formation of a bubble which can be experimentally observed. We found previously that plasmas with a free electron density <1021cm-3 are formed also in a fairly large irradiance range below the breakdown threshold. The present study investigates the chemical, thermal, and thermomechanical effects produced by these low-density plasmas. We use a rate equation model considering multiphoton ionization and produced by these low-density plasmas. We use a rate equation model considering multiphoton ionization and avalanche ionization to numerically simulate the temporal evolution of the free electron density during the laser pulse for a given irradiance, and to calculate the irradiance dependence of the free-electron density and volumetric energy density reached at the end of the laser pulse. The value of the energy density created by each laser pulse is then used to calculate the temperature distribution in the focal region after application of a single laser pulse and of series of pulses. The results of the temperature calculations yield, finally, the starting point for calculations of the thermoelastic stresses that are generated during the formation of the low-density plasmas. We found that, particularly for short wavelengths, a large 'tuning range' exists for the creation of spatially extremely confined chemical, thermal and mechanical effects via free electron generation through nonlinear absorption. Photochemical effects dominate at the lower end of this irradiance range, whereas at the upper end they are mixed with thermal effects and modified by thermoelastic stresses. Above the breakdown threshold, the spatial confinement is partly destroyed by cavitation bubble formation, and the laser-induced effects become more disruptive. Our simulations revealed that the highly localized ablation of intracellular structures and intranuclear chromosome dissection recently demonstrated by other researchers are probably mediated by free-electron- induced chemical bond breaking and not related to heating or thermoelastic stresses. We conclude that low density plasmas below the optical breakdown threshold can be a versatile tool for the manipulation of transparent biological media and other transparent materials. (enabling, e.g., the generation of optical waveguides in bulk glass). Low density plasmas may, however, also be a potential hazard in multiphoton microscopy and higher harmonic imaging.