Eph receptor signaling plays key roles in vertebrate tissue boundary formation, axonal pathfinding, and stem cell regeneration by steering cells to positions defined by its ligand ephrin. Some of the key events in Eph-ephrin signaling are understood: ephrin binding triggers the clustering of the Eph receptor, fostering transphosphorylation and signal transduction into the cell. However, a quantitative and mechanistic understanding of how the signal is processed by the recipient cell into precise and proportional responses is largely lacking. Studying Eph activation kinetics requires spatiotemporal data on the number and distribution of receptor oligomers, which is beyond the quantitative power offered by prevalent imaging methods. Here we describe an enhanced fluorescence fluctuation imaging analysis, which employs statistical resampling to measure the Eph receptor aggregation distribution within each pixel of an image. By performing this analysis over time courses extending tens of minutes, the information-rich 4D space (x, y, oligomerization, time) results were coupled to straightforward biophysical models of protein aggregation. This analysis reveals that Eph clustering can be explained by the combined contribution of polymerization of receptors into clusters, followed by their condensation into far larger aggregates. The modeling reveals that these two competing oligomerization mechanisms play distinct roles: polymerization mediates the activation of the receptor by assembling monomers into 6- to 8-mer oligomers; condensation of the preassembled oligomers into large clusters containing hundreds of monomers dampens the signaling. We propose that the polymerization–condensation dynamics creates mechanistic explanation for how cells properly respond to variable ligand concentrations and gradients.