Cap hydrolysis by Dcp2 is a critical step in several eukaryotic mRNA decay pathways. Processing requires access to cap-proximal nucleotides and the coordinated assembly of a decapping mRNP, but the mechanism of substrate recognition and regulation by protein interactions have remained elusive. Using NMR spectroscopy and kinetic analyses, we show that yeast Dcp2 resolves interactions with the cap and RNA body using a bipartite surface that forms a channel intersecting the catalytic and regulatory Dcp1-binding domains. The interaction with cap is weak but specific and requires binding of the RNA body to a dynamic interface. The catalytic step is stimulated by Dcp1 and its interaction domain, likely through a substrate-induced conformational change. Thus, activation of the decapping mRNP is restricted by access to 5'-proximal nucleotides, a feature that could act as a checkpoint in mRNA metabolism.