Notch2, but not Notch1, plays indispensable roles in kidney organogenesis, and Notch2 haploinsufficiency is associated with Alagille syndrome. We proposed that proximal nephron fates are regulated by a threshold that requires nearly all available free Notch intracellular domains (NICDs) but could not identify the mechanism that explains why Notch2 (N2) is more important than Notch1 (N1). By generating mice that swap their ICDs, we establish that the overall protein concentration, expression domain, or ICD amino acid composition does not account for the differential requirement of these receptors. Instead, we find that the N2 extracellular domain (NECD) increases Notch protein localization to the cell surface during kidney development and is cleaved more efficiently upon ligand binding. This context-specific asymmetry in NICD release efficiency is further enhanced by Fringe. Our results indicate that an elevated N1 surface level could compensate for the loss of N2 signal in specific cell contexts.