We report an alternative approach to describe radiation-matter interaction that extends conventional perturbation theory to accommodate arbitrary field strength by introducing the concept of self-regulated partitioning of the interaction Hamiltonian. The treatment gives a clear physical insight into field-induced splitting of the states, called here partially dressed states, and also accounts for the transition of energy between the states. In general these states are characterized by the strength and form of the field-matter interaction and determined by comparison with density-matrix analysis. Using these states as base states, this theory allows for a perturbation-expansion analysis for arbitrary interaction strength. This treatment provides an analytic basis for describing multilevel radiation interactions, and by way of example we consider its application to third-harmonic generation. © 1992 The American Physical Society.