The dynamics of the potential-sensitive styryl dye RH421 in dimyristoylphosphatidylcholine vesicles have been investigated above and below the main phase transition temperature using iodine-laser temperature-jump relaxation spectrophotometry and time-resolved fluorescence lifetime measurements. Equilibrium fluorescence titrations have shown that the affinity of the dye for the membrane is much higher in the liquid-crystalline state than in the gel state. The interaction can be described by either a partition or a binding model and a theory is presented providing a relation between these two approaches. In the liquid-crystal line state bound dye exhibits steady-state fluorescence relaxation processes in the submicrosecond and millisecond time range following a temperature jump. Time-resolved fluorescence measurements show a variation in the fluorescence lifetime across the emission spectrum, suggesting an excited-state process occurring on the subnanosecond time scale. These processes are most likely related to dye and/or lipid reorientation following the temperature jump or excitation pulse. Temperature-dependent changes in the fluorescence excitation spectrum of bound dye suggest that the dye exists in at least two different sites within the membrane.