For the organic light emitting diode compound aluminum(III) tris(8-hydroxyquinoline) (Alq(3)), dissolved in dimethylformamide (DMF), the time dependence of the fluorescence anisotropy has been studied using the femtosecond fluorescence upconversion technique. Upon excitation within the first absorption band, near 364 nm, with polarized laser pulses of duration less than 150 fs, an initial fluorescence anisotropy of about 0.2 is found to rapidly decay with a time constant of 2.0 +/- 0.2 ps. The observed fast anisotropy decay component is concomitant with the solvation-induced dynamic Stokes shift of about 1000 cm(-1). When excitation is at wavelengths below 330 nm, the fluorescence of Alq(3) in liquid solution does not show any anisotropy effect. It is discussed that the emissive lowest excited electronic state of Alq(3) is ligand localized and that its electronic wave function is affected by solvation. More specifically, the electronic wave function is considered to be an admixture of wave functions belonging to several close-lying states. Upon pulsed optical excitation, the admixture is assumed to vary with time, the time dependence being determined by the time evolution of the generalized solvation coordinate. The solvation-induced changes of the excited-state wave function effectuates a directional change of the emission transition dipole moment and thus gives rise to a temporal dependence of the fluorescence anisotropy. The rotational motion's of the Alq(3) solute molecules also contribute to the fluorescence anisotropy decay. However, these motions occur on a much slower time scale (about 100 ps). A comparative study of the fluorescence anistropy decay of Alq(3) in different solvents shows that the rotational motions of the Alq(3) molecules follow the Debye-Stokes-Einstein relation.