This paper describes an ultralow-power VCSEL transmitter in 32 nm SOI CMOS. To increase its power efficiency, the VCSEL is driven at a low bias current. Driving the VCSEL in this condition increases its inherent nonlinearity. Conventional pre-emphasis techniques cannot compensate for this effect because they have a linear response. To overcome this limitation, a nonlinear equalization scheme is proposed. A dynamic VCSEL modelling technique is used to generate the time-domain optical responses for “one” and “zero” bits. Based on the asymmetry of the two responses, the rising and falling edges are equalized separately. Additionally, instead of using fixed bit delays, the equalization delay is selected based on the bias current of the VCSEL. The efficiency of the proposed modelling and equalization technique is evaluated through simulations and measurements. The transmitter achieves energy efficiency of 0.77 pJ/b at 20 Gb/s and occupies 100 μm × 60 μm active silicon area.