Nickel ditelluride (NiTe₂) is a newly identified Type-II Dirac semimetal, showing novel characteristics in electronic transport and optical experiments. This study explores the nonlinear optical properties of 2D NiTe₂ using experimental and computational techniques (density functional theory-based approach). Few layered 2D-NiTe₂ are synthesized using liquid phase exfoliation (LPE), which is characterized using X-ray diffraction technique, transmission electron, and atomic force microscopy. The nonlinear refractive index ($${n_2}$$) and third-order nonlinear susceptibility ($$\chi _{total}^{( 3 )}$$) of the prepared 2D-NiTe₂ are determined from the self-induced diffraction pattern generated using different wavelengths (λ = 650, 532, and 405 nm) in the far field. In addition, the diffraction pattern generated by spatial self-phase modulation (SSPM) is further verified by varying concentration (2D-NiTe₂ in the IPA solvent), wavelength (of incoming laser beams), and cuvette width (active path length). The high value of third-order nonlinear susceptibility for a monolayer $$\chi _{monolayer}^{( 3 )}$$ (in order of ×10⁻⁹ e.s.u.) determined using SSPM in the 2D-NiTe₂ can be attributed to the laser-induced hole coherence effect. Last, utilizing the reverse saturable absorption property of 2D-hBN, asymmetric light propagation is also demonstrated in the 2D-NiTe₂/2D-hBN heterostructure.