The Hippo (Hpo) signaling pathway controls organ size by regulating the balance between cell proliferation and apoptosis. Although the Hpo function is conserved, little is known about the mechanism of how its kinase activity is regulated. Based on structural information, we performed mutation-function analysis and provided in vitro and in vivo evidence that Hpo activation requires proper dimerization of its N-terminal kinase domain as well as the C-terminal SARAH domain. Hpo carrying point mutation M242E can still dimerize, yet the dimers formed between intermolecular kinase domains were altered in conformation. As a result, autophosphorylation of Hpo at Thr-195 was blocked, and its kinase activity was abolished. In contrast, Hpo carrying I634D, a single mutation introduced in the Hpo C-terminal SARAH domain, disrupted the dimerization of the SARAH domain, leading to reduced Hippo activity. We also find that the Hpo C-terminal half contains two nuclear export signals that promote cytoplasmic localization and activity of Hpo. Taken together, our results suggest that dimerization and nucleocytoplasmic translocation of Hpo are crucial for its biological function and indicate that a proper dimer conformation of the kinase domain is essential for Hpo autophosphorylation and kinase activity.