Liquid Crystal Elastomers (LCEs) combine the anisotropic ordering of liquid crystals with the elastic properties of elastomers, providing unique physical properties, such as stimuli responsiveness and a recently discovered molecular auxetic response. Here, we determine how the molecular relaxation dynamics in an acrylate LCE are affected by its phase using broadband dielectric relaxation spectroscopy, calorimetry and rheology. Our LCE is an excellent model system since it exhibits a molecular auxetic response in its nematic state, and chemically identical nematic or isotropic samples can be prepared by cross-linking. We find that the glass transition temperatures (Tg) and dynamic fragilities are similar in both phases, and the T-dependence of the α relaxation shows a crossover at the same T* for both phases. However, for T>T*, the behavior becomes Arrhenius for the nematic LCE, but only more Arrhenius-like for the isotropic sample. We provide evidence that the latter behavior is related to the existence of pre-transitional nematic fluctuations in the isotropic LCE, which are locked in by polymerization. The role of applied strain on the relaxation dynamics and mechanical response of the LCE is investigated; this is particularly important since the molecular auxetic response is linked to a mechanical Fréedericksz transition that is not fully understood. We demonstrate that the complex Young’s modulus and the α relaxation time remain relatively unchanged for small deformations, whereas for strains for which the auxetic response is achieved, significant increases are observed. We suggest that the observed molecular auxetic response is coupled to the strain-induced out-of-plane rotation of the mesogen units, in turn driven by the increasing constraints on polymer configurations, as reflected in increasing elastic moduli and α relaxation times; this is consistent with our recent results showing that the auxetic response coincides with the emergence of biaxial order.