The establishment of cell polarity in budding yeast involves assembly of actin filaments at specified cortical domains. Elucidation of the underlying mechanism requires an understanding of the machinery that controls actin polymerization and how this machinery is in turn controlled by signaling proteins that respond to polarity cues. We showed previously that the yeast orthologue of the Wiskott-Aldrich Syndrome protein, Bee1/Las17p, and the type I myosins are key regulators of cortical actin polymerization. Here, we demonstrate further that these proteins together with Vrp1p form a multivalent Arp2/3-activating complex. During cell polarization, a bifurcated signaling pathway downstream of the Rho-type GTPase Cdc42p recruits and activates this complex, leading to local assembly of actin filaments. One branch, which requires formin homologues, mediates the recruitment of the Bee1p complex to the cortical site where the activated Cdc42p resides. The other is mediated by the p21-activated kinases, which activate the motor activity of myosin-I through phosphorylation. Together, these findings provide insights into the essential processes leading to polarization of the actin cytoskeleton.