  {\it Fermi Gamma-ray Space Telescope} observations of GRB110721A have
revealed two emission components from the relativistic jet: emission from the
photosphere, peaking at $\sim 100$ keV and a non-thermal component, which peaks
at $\sim 1000$ keV. We use the photospheric component to calculate the
properties of the relativistic outflow. We find a strong evolution in the flow
properties: the Lorentz factor decreases with time during the bursts from
$\Gamma \sim 1000$ to $\sim 150$ (assuming a redshift $z=2$; the values are
only weakly dependent on unknown efficiency parameters). Such a decrease is
contrary to the expectations from the internal shocks and the isolated magnetar
birth models. Moreover, the position of the flow nozzle measured from the
central engine, $r_0$, increases by more than two orders of magnitude. Assuming
a moderately magnetised outflow we estimate that $r_0$ varies from $10^6$ cm to
$\sim 10^9$ cm during the burst. We suggest that the maximal value reflects the
size of the progenitor core. Finally, we show that these jet properties
naturally explain the observed broken power-law decay of the temperature which
has been reported as a characteristic for GRB pulses.
