To study membrane interactions, we use a previously described model system with intact PR8 influenza viruses and small liposomes containing the virus receptor G(D1a). The assay is based on the fluorescent membrane marker octadecylrhodamine B chloride, R18, incorporated in liposomes. With this assay two processes can be studied in parallel: hemagglutinin-dependent virus/liposome fusion and spontaneous marker transfer. We present a detailed kinetic analysis of fusion and transfer which takes into account the contribution of dequenching and quenching in donor and acceptor vesicles, respectively. Both fusion and transfer follow second-order kinetics; they differ, however, in the interacting species. Fusion is collision-mediated, i.e. it depends on the total particle concentration. For R18 transfer, the rate is independent of the particle concentration, but determined by the R18 surface density, i.e. the R18/lipid ratio, which is responsible for the initial quenching of the labelled species.