The excitation decay kinetics of polar Indandione-1,3 Pyridinium Betaine (LPB) molecules in various environments: solvents, films and crystals, were studied using time-resolved luminescence and transient absorption measurements. A red-shift, depolarization and fast decay of the luminescence intensity were observed on a femtosecond time scale in dilute solutions and explained by excitation relaxation from the initially created intramolecular charge transfer state to the lower energy excited state of the indandione moiety. The first fast relaxation stage is followed by a slower one responsible for the relaxation to the ground state stage with the rate depending on the viscosity of the surrounding. By comparing the excitation properties of IPB in solution and those in the crystal form, the influence of the intermolecular interactions on the excited state dynamics is revealed. Excitation relaxation in the IPB deposited films of different thickness and in a single crystal is described as a competition between different relaxation paths of nonradiative recombination, these paths being the high lying Frenkel exciton states and the low lying intermolecular charge transfer states.