Thank you for including the Manufacturer, Model and Model number
Lutron makes a long list of products.
I found the product manual at Lutron: and am looking at the instructions
http://www.lutron.com/TechnicalDocumentLibrary/033100b.pdfThe Lutron device replaces an ordinary single pole switch.
It is not made to control compact florescent bulbs, just incandescent bulbs.
The switch has to have a ground wire.
Lutron tech assistance 1-800-523-9466 (included just in case I cannot find the trouble)
Troubleshooting in manual: They mention 'upper LED on wall control cycle rapidly.'
The solution is to check wiring, which we will review.
The fan and lights are supposed to be on high (this means your pull chain controls located on fan)
Let's review the wiring.
The switch wires connect to either brass screw.
The switch wires are usually black. Let's say they are black.
One of the black switch wires travels to fan in a cable.
This cable has 2 wires: a black and white.
This cable goes to fan.
The black wire carries power to the fan.
The power wire, or Hot wire from switch connects to the Module-black wire.
The Module-white wire connects to the Neutrals (which are white and usually twisted together and covered with a wire nut).
So all your Neutrals are joined together and covered with wire nut.
The Module-red wire connects to light-wire
The Module-yellow wire connects to fan-wire.
I'm looking at this wiring and it seems so straightforward, I can't find a problem.
According to the troubleshoot, the fan could NOT work properly if the wires were reversed at the Module.
The switch wires connect to either terminals, so there's no confusion there.
1) Unless you forgot the ground wire, or 2) you're using compact florescent bulbs, or 3) the light is not on high, I can't see where the problem is.
I suggest you call the Lutron tech support number.
They may suggest a circuit analyzer, for example a small voltage ground fault in the line might affect their device.
In any case, I want to know how this turns out because I specialize in electrical devices.
Add a comment and keep me updated.