The hedgehog (hh) gene encoding a secreted protein was originally identified in Drosophila as a segment polarity gene. The vertebrate homologues of Hh comprise several proteins including sonic hedgehog (Shh), Indian hedgehog (Ihh), and Desert hedgehog (Dhh). Hedgehog proteins are important signaling molecules during embryonic development. Shh genes are highly conserved and have been identified in a variety of species including human, mouse, frog, fish, and chicken. Mouse and human Shh are 92% identical at the amino acid sequence level. Shh is expressed in key embryonic tissues such as the Hensen’s node, the zone of polarizing activity in the posterior limb bud, the notochord, and the floor plate of the neural tube. Shh is involved in regulating the patterning of the developing central nervous system, somite, and limb. Shh plays an important role in the development of particular tissues such as whisker, hair, foregut, tooth and bone. Evidence also suggests that Shh is involved in regulating stem cell fates of neural and hematopoeitic lineages, and that aberrant Shh signaling is implicated in basal cell carcinomas and other diseases.

Mouse Shh cDNA encodes a 437 amino acid residue with a predicted 24 aa residue signal peptide that is cleaved to generate a 413 aa residue precursor protein. An autocatalytic reaction yields a 19 kDa amino-terminal domain Shh-N protein containing cholesterol and palmitate, and a 27 kDa carboxy-terminal domain Shh-C protein. The N-terminal domain retains all known signaling capabilities, while the C-terminal domain is responsible for the intramolecular processing, acting as a cholesterol transferase. Shh can act as both a short-range contact dependent factor and as a long-range, diffusible morphogen. At the cell surface, Shh activity is mediated by a multicomponent receptor complex involving the 12-pass transmembrane protein Patched (Ptc) which binds Shh with high affinity and Smoothened (Smo), a signaling seven transmembrane G-protein coupled receptor. In the absence of Shh, Ptc represses Smo activity. The binding of Shh to Ptc, releases the basal repression of Smo by Ptc (1‑5).