diff --git a/src/state/transition/mod.rs b/src/state/transition/mod.rs
index 391752ffda..b8bf18c033 100644
--- a/src/state/transition/mod.rs
+++ b/src/state/transition/mod.rs
@@ -1,3 +1,5 @@
+extern crate rlp;
+
 use super::bytes;
 use super::config;
 use super::utils;
@@ -7,8 +9,11 @@ use super::aggregate_vote;
 use super::crystallized_state;
 use super::crosslink_record;
 use super::partial_crosslink_record;
+use super::recent_proposer_record;
 use super::validator_record;
+use super::block;
 
+pub mod new_active_state;
 pub mod crosslinks;
 pub mod deposits;
 pub mod epoch;
diff --git a/src/state/transition/new_active_state.rs b/src/state/transition/new_active_state.rs
new file mode 100644
index 0000000000..612de2822c
--- /dev/null
+++ b/src/state/transition/new_active_state.rs
@@ -0,0 +1,77 @@
+use std::ops::BitXor;
+
+use super::active_state::ActiveState;
+use super::crystallized_state::CrystallizedState;
+use super::recent_proposer_record::RecentPropserRecord;
+use super::block::Block;
+use super::utils::types::Sha256Digest;
+use super::config::Config;
+use super::rlp;
+
+use super::attestors::{
+    process_attestations,
+    get_attesters_and_proposer
+};
+use super::ffg::update_ffg_and_crosslink_progress;
+
+pub fn compute_new_active_state(
+    cry_state: &CrystallizedState,
+    act_state: &ActiveState,
+    parent_block: &Block,
+    block: &Block,
+    config: &Config)
+    -> ActiveState
+{
+    let (attestation_indicies, proposer) = get_attesters_and_proposer(
+        &cry_state,
+        &act_state,
+        &block.skip_count,
+        &config);
+
+    let parent_block_rlp = rlp::encode(parent_block);
+    let attesters_option = process_attestations(
+        &cry_state.active_validators,
+        &attestation_indicies,
+        &block.attestation_bitfield,
+        &parent_block_rlp.to_vec(),
+        &block.attestation_aggregate_sig);
+
+    // TODO: bls verify signature here.
+    
+    let (partial_crosslinks, ffg_voter_bitfield, total_new_voters) = 
+        update_ffg_and_crosslink_progress(
+            &cry_state,
+            &act_state.partial_crosslinks,
+            &act_state.ffg_voter_bitfield,
+            &block.shard_aggregate_votes,
+            &config);
+
+    let attesters = match attesters_option {
+        None => panic!("No attestors available"),
+        Some(x) => x
+    };
+
+    let proposer = RecentPropserRecord {
+        index: proposer,
+        randao_commitment: Sha256Digest::zero(),
+        balance_delta: (attesters.len() + total_new_voters) as i64
+    };
+
+    let height = act_state.height + 1;
+    let randao = act_state.randao.bitxor(block.randao_reveal);
+    let mut recent_attesters = act_state.recent_attesters.to_vec();
+    recent_attesters.extend_from_slice(&attesters);
+    let total_skip_count = act_state.total_skip_count + block.skip_count;
+    let mut recent_proposers = act_state.recent_proposers.to_vec();
+    recent_proposers.push(proposer);
+
+    ActiveState {
+        height,
+        randao,
+        ffg_voter_bitfield,
+        recent_attesters,
+        partial_crosslinks,
+        total_skip_count,
+        recent_proposers
+    }
+}