While important insights were gained about how FGF21 and other endocrine fibroblast growth factors (FGFs) bind to Klotho proteins, the exact mechanism of Klotho/FGF receptor assembly that drives receptor dimerization and activation has not been elucidated. The prevailing dogma is that Klotho proteins substitute for the loss of heparan sulfate proteoglycan (HSPG) binding to endocrine FGFs by high-affinity binding of endocrine FGF molecules to Klotho receptors. To explore a potential role of HSPG in FGF21 signaling, we have analyzed the dynamic properties of FGF21-induced FGF21-βKlotho-FGFR1c complexes on the surface of living wild-type (WT) or HSPG-deficient Chinese hamster ovary (CHO) cells by employing quantitative single-molecule fluorescence imaging analyses. Moreover, detailed analyses of FGF21 and FGF1 stimulation of cellular signaling pathways activated in WT or in HSPG-deficient CHO cells are also analyzed and compared. These experiments demonstrate that heparin is required for the formation of FGF21-βKlotho-FGFR1c complexes on the cell membrane and that binding of heparin or HSPG to FGFR1c is essential for optimal FGF21 stimulation of FGFR1c activation, mitogen-activated protein kinase responses, and intracellular Ca2+ release. It is also shown that FGF1 binding stimulates assembly of βKlotho and FGFR1c on cell membranes, resulting in endocytosis and degradation of βKlotho. We conclude that heparin or HSPG is essential for FGF21 signaling and for regulation of βKlotho cellular stability by acting as a coligand of FGFR1c.