Abstract: In the dynamic process of power systems, the amplitude/frequency of voltages and currents are actually time-varying; thus this paper called them the time-varying amplitude-frequency signals. At present, the research about understanding the physical concept of active and reactive power in dynamic process when the amplitude/frequency of voltages and currents are arbitrarily time-varying, is rarely involved in the existing literature. To solve this problem, this paper described the voltages and currents by the instantaneous amplitude and instantaneous frequency and provided their analytical expressions. Then, according to the basic physical meaning of the active and reactive power in three-phase system, orthogonal decomposition of current space rotation vector was carried out. Then, expressions of active and reactive current components in each phase and instantaneous power components were obtained. And the calculation formulas of three-phase active and reactive power were derived. The active/reactive power explained and calculated under the time-varying amplitude-frequency signals has a clear physical significance and a concise form. Besides, it can be applied to the dynamic process when the amplitude/frequency of voltages and currents are arbitrarily time-varying, so that overcomes the limitation of traditional power theory only for sinusoidal steady-state circuit. Finally, time-domain simulation in Matlab/Simulink was given to verify the effectiveness of the promotion of traditional three-phase power theory by this paper.