An exact kinetic equation for plasma and the electromagnetic field is derived. This equation describes the fluctuations of the fields and particle distributions. The solution is obtained by expanding in a parameter which characterizes the amplitude of these fluctuations. A systematic procedure is given for generating the solution to arbitrary order in the expansion. Some typical applications of the theory are presented. These include calculations of a collision integral, incoherent scattering, and bremsstrahlung emission and absorption.