We describe a novel optomechanical device that produces strong reflectance and polarization modulation of incident light. The structure is based on a suspended nanomechanical grating with lateral deformability, and rigorous coupled-wave analysis has been used to fully model the optical properties of the device. The grating consists of two interdigitated gratings that may be moved with respect to each other with an applied force. The structures proposed here are designed to be readily manufacturable with device processing developed for surface-micromachined microelectromechanical systems and with known microelectromechanical systems materials, such as silicon, silicon nitride, and amorphous diamond. As the spacing of the grating is changed, an anomalous diffraction effect is observed, a Wood's type anomaly in which there exists a resonance in propagating leaky modes within the grating, resulting in a dramatic change in the reflectance characteristics for slight changes in the grating. One of the unique features of this structure is that a reflected optical signal can be used to detect subangstrom in-plane motion of structures greater than 10 nm.