  A non-expanded theory is used for dispersion potentials between atoms and
ions dissolved in a medium. The first-order dispersion interaction between two
atoms in an excited state must account for the fact that the two atoms are
coupled via the electromagnetic field and must include effects from background
media, retardation and finite size. We show that finite-size corrections when
two particles are close change the dispersion interactions in water by several
orders of magnitude. We consider as four illustrative examples helium atoms,
krypton atoms, phosphate ions, and iodide ions. We demonstrate that, due to
large cancellation effects, retardation dominates the interaction for helium
atom pairs in an isotropic excited state down to the very small atom-atom
separations where finite-size corrections are also important
