A detailed analysis of damping and noise due to a $sd$ interaction in a thin ferromagnetic film sandwiched between two large normal metal layers is carried out. The magnetization is shown to obey, in general, a nonlocal equation of motion, which differs from the the Gilbert equation and is extended to the nonadiabatic regime. To the lowest order in the exchange interaction and in the limit where the Gilbert equation applies, we show that the damping term is enhanced due to interfacial effects, but it also shows oscillations as a function of the film thickness. The noise calculation is, however, carried out to all orders in the exchange-coupling constant. The ellipticity of the precession of the magnetization is taken into account. The damping is shown to have a Gilbert form only in the adiabatic limit, while the relaxation time becomes strongly dependent on the geometry of the thin film. It is also shown that the induced noise characteristic of $sd$ exchange is inherently colored in character and depends on the symmetry of the Hamiltonian of the magnetization in the film. We show that the $sd$ noise can be represented in terms of an external stochastic field, which is white only in the adiabatic regime. The temperature is also renormalized by the spin accumulation in the system. For large intra-atomic exchange interactions, the Gilbert-Brown equation is no longer valid.