We induce strong nonlocal interactions in a 2D Fermi gas in an optical lattice using Rydberg dressing. The system is approximately described by a t - V model on a square lattice where the fermions experience isotropic nearest-neighbor interactions and are free to hop only along one direction. We measure the interactions using many-body Ramsey interferometry and study the lifetime of the gas in the presence of tunneling, finding that tunneling does not reduce the lifetime. To probe the interplay of nonlocal interactions with tunneling, we investigate the short-time-relaxation dynamics of charge-density waves in the gas. We find that strong nearest-neighbor interactions slow down the relaxation. Our work opens the door for quantum simulations of systems with strong nonlocal interactions such as extended Fermi-Hubbard models.