Mitochondrial Ca2+ uptake via the uniporter is central to cell metabolism, signaling, and survival. Recent studies identified MCU as the uniporter’s likely pore and MICU1, an EF-hand protein, as its critical regulator. How this complex decodes dynamic cytoplasmic Ca2+ (Ca2+c) signals, to tune out small Ca2+c increases yet permit pulse transmission, remains unknown. We report that loss of MICU1 in mouse liver and cultured cells causes mitochondrial Ca2+ accumulation during small Ca2+c elevations but an attenuated response to agonist-induced Ca2+c pulses. The latter reflects loss of positive cooperativity, likely via the EF-hands. MICU1 faces the intermembrane space and responds to Ca2+c changes. Prolonged MICU1 loss leads to an adaptive increase in matrix Ca2+ binding, yet cells show impaired oxidative metabolism and sensitization to Ca2+ overload. Collectively, the data indicate that MICU1 senses the Ca2+c to establish the uniporter’s threshold and gain, thereby allowing mitochondria to properly decode different inputs. Display omitted •MICU1 regulates the Ca2+ threshold and cooperativity of the mitochondrial uniporter•MICU1 faces the intermembrane space to sense cytoplasmic Ca2+•Loss of MICU1 initiates an adaptive increase in mitochondrial matrix Ca2+ binding•Yet decoding of Ca2+ signals is compromised, impairing ATP output and cell survival