Recent advancements in high-power, ultrashort terahertz (THz) pulse generation have opened new frontiers in nonlinear optics and materials science. This thesis explores novel THz-induced nonlinear optical effects and ultrafast structural control mechanisms, with far-reaching implications for advancing THz-based techniques in materials characterization and optoelectronic device development. We first identify and investigate two novel phonon-induced nonlinear optical effects under intense THz radiation: third-harmonic generation (THG) and THz nonlinear birefriengence, both driven by sum-frequency excitation of Raman-active phonons. These processes exhibit a strong phonon-contributed $\chi^{(3)}$ nonlinearity which is 58 times larger than the off-resonance electronic $\chi^{(3)}$ nonlinearity. The experimental results reveal that phonon-mediated THG strongly depends on the frequency and polarization of the incident THz field. Remarkably, the interference between electronic and phonon contributions to $\chi^{(3)}$ allows for tuning the THG efficiency over six orders of magnitude by modulating THz excitation parameters. This mechanism offers a highly efficient and tunable frequency conversion from THz to infrared ranges, with potential applications in novel THz spectroscopic techniques and material characterization. THz-induced nonlinear birefringence, driven by a cross-phase modulation process mediated by Raman-active phonons, causes polarization rotation of the THz field toward a specific direction or ellipticity increasing of the field polarization during propagation through materials. This effect enables precise control of THz polarization states and amplitudes, demonstrating potential as a robust THz modulator for pulse shaping and all-optical switching in the THz domain. Next, we explore THz-induced ultrafast structural control through nonlinear phononic couplings, focusing on the nonlinear lattice polarizability (NLP) pathway. By manipulating THz excitation pulse parameters (frequency, duration, and polarization) or using multi-pulse sequences, we demonstrate precise control over structural deformations' magnitude, direction, and duration via NLP. In addition, we investigate NLP’s contributions to second-order nonlinearities in non-centrosymmetric materials, confirming the close connection between structural and optical properties. This insight offers new opportunities for ultrafast control and switching of light pulses and crystal structures through THz-induced nonlinearity. In conclusion, this thesis provides new insights into THz-driven nonlinear optical effects and ultrafast structural dynamics. The presented findings have implications spanning from efficient THz frequency conversion, ultrafast spectroscopy, to the discovery of exotic phases of matter. Moreover, these findings hold promise for developing optoelectronic devices for next-generation THz technologies, potentially impacting fields from high-speed THz communications to quantum information processing.