Hollow AgAu nanostructures have a myriad of potential applications related to their strong and tunable localized surface plasmon resonances. Here, we describe how the hydrolysis of the Au precursor, AuCl4–, produces AuCl4–x(OH)x–, where x is both time and pH-dependent, and how this can be used to control the morphology of hollow nanoshells in the co-reduction-assisted galvanic replacement of Ag by Au. Controlling the degree of hydrolysis is the key to obtain smooth shells: too small values of x (low hydrolysis) yield inhomogeneously replaced rough shells whereas too large values of x lead to the dominance of Au nucleation over galvanic replacement. Kinetic studies reveal two time constants for the galvanic replacement varying with temperature and composition; a short (<10 min) half-life component associated with the initial void creation and a long (>100 min) half-life component associated with the continuous reduction and replacement of Ag. By optimizing the reaction’s pH and Au speciation, we obtained smooth alloy shells with fine control of composition, size, and shape over a broad range, thereby tuning the optical properties. This framework for understanding and controlling reaction kinetics and nanoshell morphology is applicable to other metallic systems and precursors, providing new ways to rationally design nanostructure syntheses.