The working principles of linear optical quantum computing are based on photodetection, namely, projective measurements. The use of photodetection can provide efficient nonlinear interactions between photons at the single-photon level, which is technically problematic otherwise. We report an application of such a technique to prepare quantum correlations as an important resource for Heisenberg-limited optical interferometry, where the sensitivity of phase measurements can be improved beyond the usual shot-noise limit. Furthermore, using such nonlinearities, optical quantum non-demolition measurements can now be carried out easily at the single-photon level.