We explore electron dynamics in molecular (CD4)(1061) clusters and elemental Xe-n (n=249-2171) clusters, responding to ultraintense (intensity I=10(16)-10(19) W cm(-2)) laser fields. Molecular dynamics simulations (including magnetic field and relativistic effects) and analyses of high-energy electron dynamics and nuclear ion dynamics in a cluster interacting with a Gaussian shaped laser field (frequency 0.35 fs(-1), photon energy 1.44 eV, phase 0, temporal width 25 fs) elucidated the time dependence of inner ionization, the formation of a nanoplasma of unbound electrons within the cluster or its vicinity, and of outer ionization. We determined the cluster size and the laser intensity dependence of these three sequential-parallel electronic processes. The characteristic times for cluster inner ionization (tau(ii)) and for outer ionization (tau(oi)) fall in the femtosecond time domain, i.e., tau(ii)=2-9 fs and tau(oi)=4-15 fs for (CD4)(1061), tau(ii)=7-30 fs and tau(oi)=5-13 fs for Xe-n (n=479,1061), with both tau(ii) and tau(oi) decreasing with increasing I, in accord with the barrier suppression ionization mechanism for inner ionization of the constituents and the cluster barrier suppression ionization mechanism for outer ionization. The positive delay times Deltatau(OI) between outer and inner ionization (e.g., Deltatau(OI)=6.5 fs for Xe-n at I=10(16) W cm(-2) and Deltatau(OI)=0.2 fs for (CD4)(1061) at I=10(19) W cm(-2)) demonstrate that the outer/inner ionization processes are sequential. For (CD4)(1061), tau(ii)tau(oi), reflecting on the energetic hierarchy in the ionization of the Xe atoms. Quasiresonance contributions to the outer ionization of the nanoplasma were established, as manifested in the temporal oscillations in the inner/outer ionization levels, and in the center of mass of the nanoplasma electrons. The formation characteristics, dynamics, and response of the nanoplasma in molecular or elemental clusters were addressed. The nanoplasma is positively charged, with a high-average electron density [rho(P)=(2-3)10(22) cm(-3)], being characterized by high-average electron energies epsilon(av) (e.g., in Xe-1061 clusters epsilon(av)=54 eV at I=10(16) W cm(-2) and epsilon(av)=0.56-0.37 keV at I=10(18) W cm(-2), with epsilon(av)proportional toI(1/2)). Beyond the cluster boundary the average electron energy markedly increases, reaching electron energies in the range of 1.2-40 keV for outer ionization of Xe-n (n=249-2171) clusters. The nanoplasma exhibits spatial inhomogeneity and angular anisotropy induced by the laser field. Femtosecond time scales are predicted for the nanoplasma production (rise times 7-3 fs), for the decay (decay times similar to5 fs), and for the persistence time (30-10 fs) of a transient nanoplasma at I=10(17)-10(18) W cm(-2). At lower intensities of I=10(16) W cm(-2) a persistent nanoplasma with a "long" lifetime of >50 fs will prevail. (C) 2004 American Institute of Physics.