Dispersive optical bistability with a threshold cw input power of approximately 10 mW has been observed in a single-mode fiber-optic ring resonator. Light is coupled in and out of the resonator by a single-mode-fiber variable directional coupler. A fiber-optic Faraday isolator is incorporated into the ring, thus increasing the threshold for stimulated Brillouin oscillation by a factor of 100 and permitting other weaker nonlinear effects such as bistability to be observed. Phase-sensitive amplification and deamplification (squeezing) of classical time-stationary noise is demonstrated and shown to be in agreement with the theory of squeezed-state generation in such a nonlinear fiber ring resonator. Light scattering by elastic eigenmodes of the fiber (guided-acoustic-wave Brillouin scattering, GAWBS) adds noise to light circulating in the resonator and obscures the observation of squeezed quantum fluctuations. The properties of this GAWBS scattering are investigated and compared with theory. © 1987, Optical Society of America.