A new wavefront sensing approach, derived from the successful curvature wavefront sensing concept but using a nonlinear phase retrieval wavefront reconstruction scheme, is described. The nonlinear curvature wavefront sensor (nlCWFS) approaches the theoretical sensitivity limit imposed by fundamental physics by taking full advantage of wavefront spatial coherence in the pupil plane. Interference speckles formed by natural starlight encode wavefront aberrations with the sensitivity set by the telescope’s diffraction limitλ/D λ / D rather than the seeing limit of more conventional linear wavefront sensors (WFSs). Closed-loop adaptive optics simulations show that with an nlCWFS, a 100 nm rms wavefront error can be reached on an 8 m telescope on an m V  = 13 m V = 13 natural guide star. The nlCWFS technique is best suited for high precision adaptive optics on bright natural guide stars. It is therefore an attractive technique to consider for direct imaging of exoplanets and disks around nearby stars, where achieved performance is set by wavefront control accuracy and exquisite control of low-order aberrations is essential for high contrast coronagraphic imaging. Performance gains derived from simulations are shown, and approaches for high speed reconstruction algorithms are briefly discussed.