We describe a semiclassical theoretical model on two-photon optical bistability in a nonlinear Fabry-Perot cavity filled with molecules having large permanent dipole moments under the plane wave and mean field approximations. The mathematical analysis follows with the assumption of a two-level system with large permanent dipoles. In the steady state situation, field equation is shown to provide the bistable behavior of the nonlinear cavity when resonant with two-photon excitation under certain conditions. It is shown that for a large difference in permanent dipole moment

between levels

and

, where μ
bais the transition dipole moment), the two-photon optical bistability can result in a submicron size Fabry-Perot cavity.