Nuclear Dbf2p-related (NDR) kinases and associated proteins are recognized as a conserved network that regulates eukaryotic cell polarity. NDR kinases require association with MOB adaptor proteins and phosphorylation of two conserved residues in the activation segment and hydrophobic motif for activity and function. We demonstrate that the Neurospora crassa NDR kinase COT1 forms inactive dimers via a conserved N-terminal extension, which is also required for the interaction of the kinase with MOB2 to generate heterocomplexes with basal activity. Basal kinase activity also requires autophosphorylation of the COT1-MOB2 complex in the activation segment, while hydrophobic motif phosphorylation of COT1 by the germinal center kinase POD6 fully activates COT1 through induction of a conformational change. Hydrophobic motif phosphorylation is also required for plasma membrane association of the COT1-MOB2 complex. MOB2 further restricts the membrane-associated kinase complex to the hyphal apex to promote polar cell growth. These data support an integrated mechanism of NDR kinase regulation in vivo, in which kinase activation and cellular localization of COT1 are coordinated by dual phosphorylation and interaction with MOB2. N uclear Dbf2p-related (NDR) kinases represent a subfamily of AGC (protein kinase A [PKA], PKG, and PKC-like) kinases. These kinases share structural similarities and require (auto) phosphorylation of a conserved Ser/Thr residue within the activation segment of the kinase domain for their activity. Phosphorylation of the activation segment leads to conformational changes that are required for basal enzymatic activity (31,42,45). Activation of AGC kinases also requires a second phosphorylation event or the permanent presence of an acidic residue in a hydrophobic motif that is located 45 to 60 residues C-terminal of the catalytic kinase domain in addition to phosphorylation of the activation loop (7,33,34). Germinal center (GC) kinases, a subfamily of Ste20-type kinases (10, 47), are involved in phosphorylation of this hydrophobic motif (9,12,26,55,57,64). The phosphorylated motif interacts with a hydrophobic pocket in the N-terminal lobe of the kinase domain and induces/stabilizes the reconfiguration of the bilobal kinase structure (6,13,16,60). Thus, both the phosphorylated activation segment and the phosphorylated hydrophobic motif are required for achieving the active conformation of the kinase (31,42,45,64). Nevertheless, the chronology of these two phosphorylation events depends on the specific kinase, and either phosphorylation of the activation loop or hydrophobic motif phosphorylation can occur as the first step of kinase activation (4,18,54,56).Most AGC kinases contain functional domains other than the kinase core that are involved in regulating kinase activity and in vivo function. Important for NDR kinases are MOB coactivator proteins, which bind to the conserved N terminus of these kinases and are involved in their initial activation, presumably by promoting autophosphorylation of their act...