Wnt/β-catenin signal transduction directs metazoan development and is deregulated in numerous human congenital disorders and cancers. In the absence of Wnt stimulation, a multiprotein "destruction complex," assembled by the scaffold protein Axin, targets the key transcriptional activator β-catenin for proteolysis. Axin is maintained at very low levels that limit destruction complex activity, a property that is currently being exploited in the development of novel therapeutics for Wnt-driven cancers. Here, we use an in vivo approach in Drosophila to determine how tightly basal Axin levels must be controlled for Wnt/Wingless pathway activation, and how Axin stability is regulated. We find that for nearly all Wingless-driven developmental processes, a three- to fourfold increase in Axin is insufficient to inhibit signaling, setting a lower-limit for the threshold level of Axin in the majority of in vivo contexts. Further, we find that both the tumor suppressor adenomatous polyposis coli (APC) and the ADP-ribose polymerase Tankyrase (Tnks) have evolutionarily conserved roles in maintaining basal Axin levels below this in vivo threshold, and we define separable domains in Axin that are important for APC- or Tnks-dependent destabilization. Together, these findings reveal that both APC and Tnks maintain basal Axin levels below a critical in vivo threshold to promote robust pathway activation following Wnt stimulation.