R-spondin proteins sensitize cells to Wnt signalling and act as potent stem cell growth factors. Various membrane proteins have been proposed as potential receptors of R-spondin, including LGR4/5, membrane E3 ubiquitin ligases ZNRF3/RNF43 and several others proteins. Here, we show that R-spondin interacts with ZNRF3/RNF43 and LGR4 through distinct motifs. Both LGR4 and ZNRF3 binding motifs are required for R-spondin-induced LGR4/ZNRF3 interaction, membrane clearance of ZNRF3 and activation of Wnt signalling. Importantly, Wnt-inhibitory activity of ZNRF3, but not of a ZNRF3 mutant with reduced affinity to R-spondin, can be strongly suppressed by R-spondin, suggesting that R-spondin primarily functions by binding and inhibiting ZNRF3. Together, our results support a dual receptor model of R-spondin action, where LGR4/5 serve as the engagement receptor whereas ZNRF3/RNF43 function as the effector receptor.