mTORC1 promotes cell growth in response to nutrients and growth factors. Insulin activates mTORC1 through the PI3K-Akt pathway, which inhibits the TSC1-TSC2-TBC1D7 complex (the TSC complex) to turn on Rheb, an essential activator of mTORC1. However, the mechanistic basis of how this pathway integrates with nutrient-sensing pathways is unknown. We demonstrate that insulin stimulates acute dissociation of the TSC complex from the lysosomal surface, where subpopulations of Rheb and mTORC1 reside. The TSC complex associates with the lysosome in a Rheb-dependent manner, and its dissociation in response to insulin requires Akt-mediated TSC2 phosphorylation. Loss of the PTEN tumor suppressor results in constitutive activation of mTORC1 through the Akt-dependent dissociation of the TSC complex from the lysosome. These findings provide a unifying mechanism by which independent pathways affecting the spatial recruitment of mTORC1 and the TSC complex to Rheb at the lysosomal surface serve to integrate diverse growth signals.