The development of conjugated materials bearing electron-rich and electron-poor units along their backbone introduces new possibilities to control functionality for organic electronic applications through charge transfer character in ground and excited states. A thorough understanding of intramolecular dipoles and their evolution during excited state relaxation is necessary in order to fully exploit this opportunity. PCDTBT is an alternating donor–acceptor copolymer with high photovoltaic efficiency in bulk heterojunction solar cells. We use time-resolved femtosecond transient absorption spectroscopy in solution and in the solid state to study PCDTBT and the dTBT and CDTBT model compounds, fragments of the polymer chain. Higher solubility and slower relaxation make CDTBT particularly suitable to understand the mechanism of charge transfer relaxation in this class of materials. A progressive increase of charge transfer character from the initially moderately polar excited state is mainly driven by solvent reorganization and some torsional rearrangements. Similar relaxation in solid state CDTBT might ultimately lead to the formation of separate charges.