Here we introduce the full functional reconstitution of genetically-validated core protein machinery (SNAREs, Munc13, Munc18, Synaptotagmin, Complexin) for synaptic vesicle priming and release in a geometry that enables detailed characterization of the fate of docked vesicles both before and after release is triggered with Ca2+. Using this novel setup, we discover new roles for diacylglycerol (DAG) in regulating vesicle priming and Ca2+-triggered release involving the SNARE assembly chaperone Munc13. We find that low concentrations of DAG profoundly accelerate the rate of Ca2+-dependent release, and high concentrations reduce clamping and permit extensive spontaneous release. As expected, DAG also increases the number of ready-release vesicles. Dynamic single-molecule imaging of Complexin binding to ready-release vesicles directly establishes that DAG accelerates the rate of SNAREpin assembly mediated by Munc13 and Munc18 chaperones. The selective effects of physiologically validated mutations confirmed that the Munc18-Syntaxin-VAMP2 ‘template’ complex is a functional intermediate in the production of primed, ready-release vesicles, which requires the coordinated action of Munc13 and Munc18.