So far, Lear has mentioned his nonsense rhymes very little in the Diaries; for instance on 19 September 1860, while at Little Green with the Hornbys, one of the families that most appreciated his nonsense, he writes:

I sang nonsense for the children: & afterwards much Tennyson for the elders.

On 30 January 1860, he records taking part in an old-friends meeting at the Knights in Rome and unsuccessfully using the Book of Nonsense as a means of identifying himself:

[At] 8 to Knights, Charles, & Helen, ― Monsignor Pentini, ― D.F. Chigi, the 2 Bertie Mathews, & Karristy. All there had never met all together since 1843, & 1844 ― 16 years ago. Pentini was as ever, kindly & good, ― but did not recognize me all thro’ dinner, tho’ very much interested about Terra Santa ―: afterwards, being shown the “Book of Nonsense,” he suddenly became enlightened, ― but partially confounded me with Abeken, [Probably Wilhelm Ludwig Abeken, an archeologist who was also in Italy in the years around 1837. ] & asked after my “Leone & Scimia.”  ―

On 1 February 1861, however, we suddenly read:

I came to Dalzell’s [sic], & gave the 2 nonsenses to woodcut.

Lear had clearly started planning a new edition of the Book of Nonsense and was thinking of using woodcuts rather than the lithographic process he had used for the 1846 and 1855 editions, probably in order to reduce costs.

There will be more references to work on new “nonsenses” in the coming weeks, but you will have to wait for those; however, here is a passage from a letter he wrote to Emily Tennyson on 6 March:

… since I asked people to come  & see my pictures, they come, ― horridly & disjointedly; sometimes 20 at a time ― of all kinds of phases of life: sometimes ― for 3 hours no one comes: ― so then I partly sleep, & partly draw pages of a new Nonsense book. If I sleep, I wake savagely at some newcomer’s entrance, & they go away abashed. If I write nonsense, I am pervaded with smiles, & please the visitors.
[V. Noakes. Edward Lear 1812-1888 at the Royal Academy of Arts. London: Roayal Academy of Arts, 1985. 170.]

The Brothers Dalziel are probably the best-known wood engravers of the Victorian age ― they did volumes of illustrated Tennyson poems and Carroll’s Alice books for example. In their 1901 memoir, they wrote of their role in the publication of this third edition:

Early in the Sixties we made the acquaintance of Edward Lear, who was a landscape painter of great distinction, a naturalist, a man of high culture, and a most kind and courteous gentleman. He came to us bringing an original chromo-lithographic copy of his “Book of Nonsense”  ― published some years before by McLean of the Haymarket. His desire was to publish a new and cheaper edition. With this view he proposed having the entire set of designs redrawn on wood, and he commissioned us to do this, also to engrave the blocks, print, and produce the book for him. When the work was nearly completed, he said he would sell his rights in the production to us for £100. We did not accept his offer, but proposed to find a publisher who would undertake it. We laid the matter before Messrs. Routledge & Warne. They declined to buy, but were willing to publish it for him on commission, which they did. The first edition sold immediately. Messrs. Routledge then wished to purchase the copyright, but Mr. Lear said, “Now it is a success they must pay me more than I asked at first.” The price was then fixed at £ 120, a very modest advance considering the mark the book had made. It has since gone through many editions in the hands of F. Warne & Co.
Lear told us how “The Book of Nonsense” originated. When a young man he studied very much at the Zoological Gardens in Regent’s Park. While he was engaged on an elaborate drawing of some “Parrots,” a middle-aged gentleman used to come very frequently and talk to him about his work, and by degrees took more and more interest in him. One day he said, “I wish you to come on a visit to me, for I have much that I think would interest you.” The stranger was the Earl of Derby. Lear accepted the invitation, and it was during his many visits at Knowsley that these “Nonsense” drawings were made, and the inimitable verses written. They were generally done in the evening to please the Earl’s young children, and caused so much delightful amusement that he redrew them on stone, and published them as before stated. That is how this clever, humorous book came into existence; a work that will cause laughter and pleasure to young and old for all time. John Ruskin says of Lear’s “Book of Nonsense “:
“Surely the most beneficent and innocent of all books yet produced is the ‘Book of Nonsense,’ with its corollary carols, inimitable and refreshing, and perfect in rhythm. I really don’t know any author to whom I am half so grateful for my idle self as Edward Lear. I shall put him first of my hundred authors.”
[The Brothers Dalziel. A Record of Fifty Years’ Work in Conjunction with Many of the Most Distinguished Artists of the Period. 1840-1890. London: Methuen and Co., 1901. 317-318.]