WAVE proteins link upstream signals to actin nucleation by activating the Arp2/3 complex and are at the core of regulatory pathways driving membrane protrusion. They are found in heteropentameric complexes whose role in regulating WAVE function is presently unclear. Here we demonstrate that purified native WAVE complexes are basally inactive; previous reports of constitutive activity are artifacts of in vitro manipulation. Further, the native complexes are not activated by Rac alone. Activation of the WAVE2 complex requires simultaneous interactions with prenylated Rac-GTP and acidic phospholipids, as well as a specific state of phosphorylation. Together these signals promote full activation in a highly cooperative process on the membrane surface, by inducing an allosteric change in the complex rather than by simple recruitment or by dissociation of the subunits. These results explain how the WAVE complex can integrate coincident signals to promote localized actin nucleation during cell motility.