Indium arsenide phosphide (InAsP) nanowires (NWs), a member of the III–V semiconductor family, have been used in various photonic and optoelectronic applications thanks to their unique electrical and optical properties such as high carrier mobility and adjustable band gap. In this work, we synthesize InAsP NWs and further explore their nonlinear optical properties. The ultrafast carrier dynamics and nonlinear optical response are thoroughly studied based on the nondegenerate pump probe and Z-scan experimental measurements. Two different characteristic carrier lifetimes ($\sim 2$ and $\sim 15\mathrm{ps}$) from InAsP NWs are observed during the excited-carrier relaxation process. Based on the physical model analysis, the relaxation process can be ascribed to the carrier cooling process via carrier-phonon scattering and Auger recombination. In addition, based on the measured excited-carrier lifetime and Pauli-blocking principle, we discover that InAsP NWs show strong saturable absorption properties at the wavelengths of 532 and 1064 nm. Last, we demonstrate for the first time a femtosecond ($\sim 426\mathrm{fs}$) solid-state laser based on an InAsP NWs saturable absorber at 1.04 μm. We believe that our work provides a better understanding of the InAsP NWs optical properties and will further advance their photonic applications in the near-infrared range.