Water-soluble or water-dispersible two-photon dyes with strong fluorescence and large two-photon absorption (2PA) cross sections are very desirable for nano- and bio-photonics, but are still scarce. Herein, a new 1,4-diketo-3,6-diphenylpyrrolo[3,4-c]pyrrole derivative end-capped with two phenothiazin-N-yl donors (PDPP) is synthesized and its one- and two-photon optical properties are investigated in both solution and aqueous dispersions. The results show that PDPP exhibits solvent-independent one-photon solution absorption and emission properties with low fluorescence quantum yields, but strong red fluorescence in both aqueous dispersion and the crystalline state. This aggregation-enhanced emission (AEE) effect enables PDPP to have not only large 2PA cross sections but also a remarkably enhanced two-photon fluorescence action cross section in aqueous dispersions. Thus, 2PA-active PDPP is a promising candidate for two-photon science and technology.