Layered antiferromagnetism is the spatial arrangement of ferromagnetic layers with antiferromagnetic interlayer coupling. The van der Waals magnet chromium triiodide (CrI 3 ) has been shown to be a layered antiferromagnetic insulator in its few-layer form1, opening up opportunities for various functionalities2,3,4,5,6,7 in electronic and optical devices. Here we report an emergent nonreciprocal second-order nonlinear optical effect in bilayer CrI 3 . The observed second-harmonic generation (SHG; a nonlinear optical process that converts two photons of the same frequency into one photon of twice the fundamental frequency) is several orders of magnitude larger than known magnetization-induced SHG8,9,10,11 and comparable to the SHG of the best (in terms of nonlinear susceptibility) two-dimensional nonlinear optical materials studied so far12,13 (for example, molybdenum disulfide). We show that although the parent lattice of bilayer CrI 3 is centrosymmetric, and thus does not contribute to the SHG signal, the observed giant nonreciprocal SHG originates only from the layered antiferromagnetic order, which breaks both the spatial-inversion symmetry and the time-reversal symmetry. Furthermore, polarization-resolved measurements reveal underlying C 2h crystallographic symmetry—and thus monoclinic stacking order—in bilayer CrI 3 , providing key structural information for the microscopic origin of layered antiferromagnetism14,15,16,17,18. Our results indicate that SHG is a highly sensitive probe of subtle magnetic orders and open up possibilities for the use of two-dimensional magnets in nonlinear and nonreciprocal optical devices.