The small signaling molecule auxin controls numerous developmental processes in land plants, acting mostly by regulating gene expression. Auxin response proteins are represented by large families of diverse functions, but neither their origin nor their evolution is understood. Here, we use a deep phylogenomics approach to reconstruct both the origin and the evolutionary trajectory of all nuclear auxin response protein families. We found that, while all subdomains are ancient, a complete auxin response mechanism is limited to land plants. Functional phylogenomics predicts defined steps in the evolution of response system properties, and comparative transcriptomics across six ancient lineages revealed how these innovations shaped a sophisticated response mechanism. Genetic analysis in a basal land plant revealed unexpected contributions of ancient non-canonical proteins in auxin response as well as auxin-unrelated function of core transcription factors. Our study provides a functional evolutionary framework for understanding diverse functions of the auxin signal.