Polarized light has already been widely used for photography and display technologies. Magneto-optical Faraday effect, i.e., the light polarization rotates in the magnetic field applied to the material in the direction of light propagation, plays a crucial role in the interaction between light and spin. Faraday effect allow us to understand the nature of magnetization in condensed materials. As an effect opposite to the Faraday effect, the magnetization can be induced in a transparent medium exposed to a circularly polarized electromagnetic wave, which is called inverse Faraday effect. Knowledge of the mechanism provides the opportunities of modulation devices in photonics, ultrafast opto-magnetism and magnonics. In this paper, we experimentally demonstrate a proof-of-concept ultrafast polarization modulation by employing circularly polarized light to demonstrate a strengthened terahertz (THz) frequency Kerr modulation signal, at room temperature. By using the transient pumpprobe spectroscopy with the reflected geometry, we are able to demonstrate the feasibility of such an ultrafast magneto-optical polarization modulation at 0.19 THz in a paramagnetic Li:NaTb (WO ₄) ₂crystal with a thickness of 3 mm. The time-resolved modulation signal is explained by the interaction between two counter-propagating laser pulses (central photon energy of 1.55 eV) within the crystal via the optical Kerr effect. We find that the amplitude of the modulation increases with the pump fluence increasing, while the modulation frequency is dependent neither on the pump fluence nor on polarization of pump beam. However, it can further be found that the phase and amplitude of the transient Kerr modulation are strongly dependent on the helicity of the circularly polarized pump pulses. Indeed, these oscillating signals may be mistaken for spin excitation modes. The present findings allow us to get an insight into the transient magneto-optical dynamical process in transparent medium. In addition, the polarization modulation of ultrashort laser pulse on a picosecond time scale will facilitate all-optical data processing, as well as the polarization-dependent ultrafast dynamics in various material systems, which span from condensed matter to molecular spectroscopy. In this regard, our experimental results provide a possibility for designing novel all-optical (magneto-optical) modulators operating at THz clock frequencies. The magneto-optical polarization response modulated at THz frequencies may have new possibilities for designing all-optical devices, such as ultrafast modulators.