Detection of incipient damage in structures through material degradation monitoring is of paramount importance for the residual life prediction and maintenance decision. Nonlinear guided waves, through their interaction with micro defects in materials, show promise for pinpointing structural damage at the early stage of its initiation. This study explores the use of the third harmonic Shear Horizontal (SH) waves and experimentally investigates their abilities to monitor microstructural changes in a metallic plate. To this end, a dedicated comparison test was designed, which allowed the generation and the reception of both Lamb waves and SH waves in the same plate, using PZT and Magnetostrictive Transducers (MsTs), respectively. The configurations of the PZTs and MsTs were carefully designed so that the material nonlinearity of the plate (MNP) dominates the nonlinear responses. Thermal aging treatment was applied to the plate to tactically change its microstructure within a controlled heating area. Changes in the microstructural properties of the plate were simultaneously monitored through a Vickers hardness test. Results show that the third harmonic SH waves exhibit a much higher sensitivity to the heating-induced microstructural changes than the commonly-used second harmonic Lamb waves. The material degradations characterized with the third harmonic SH waves were further confirmed by the Vickers hardness test.