A Liouville formalism has been developed for treating energy transfer processes within the same conceptual framework as other relaxation processes. The theory of Forster, describing energy transfer between a pair of immobile fluorescent molecules has been generalized to include the effects of molecular dynamics the static, intermediate and fast dynamic regimes. Forster's master equation of the excitation populations is derived from the Liouville formalism and we arrive at the proper criteria for its validity within the physical model. A closed form expression is derived for the fluorescence anisotropy of a macromolecular system containing pair of pairwise interacting chromophores where one of the chromophores undergoes a two state conformational change. The expression derived is valid without assuming that the nonradiative state and the conformation dynamic is uncoupled. It is shown that when energy transfer and conformational changes occur on the same time scale, the decay times of the fluorescence anisotropy depend in a complex way on the molecular relaxation.