An analytical theory is developed to describe the dynamics of a closed lipid bilayer membrane (vesicle) freely suspended in a general linear flow. Considering a nearly spherical shape, the solution to the creeping-flow equations is obtained as a regular perturbation expansion in the excess area. The analysis takes into account the membrane fluidity, incompressibility, and resistance to bending. The constraint for a fixed total area leads to a nonlinear shape evolution equation at leading order. As a result two regimes of vesicle behavior, tank treading and tumbling, are predicted depending on the viscosity contrast between interior and exterior fluid. Below a critical viscosity contrast, which depends on the excess area, the vesicle deforms into a tank-treading ellipsoid, whose orientation angle with respect to the flow direction is independent of the membrane bending rigidity. In the tumbling regime, the vesicle exhibits periodic shape deformations with a frequency that increases with the viscosity contrast. Non-Newtonian rheology such as normal stresses is predicted for a dilute suspension of vesicles. The theory is in good agreement with published experimental data for vesicle behavior in simple shear flow.