The identification of mutations in Hedgehog (HH) pathway genes in some basal cell carcinomas (BCC) and the detection of HH pathway dysregulation in almost all BCC confirms the importance of this developmental regulatory pathway in human BCC tumorigenesis. Moreover, the occurrence of UVB signature mutations in key HH pathway genes in BCC provides the first genetic evidence that UV radiation (UVR) may be the principal mutagen involved in BCC tumorigenesis. We review herein current advances in the understanding of the role of the HH pathway in BCC tumorigenesis including transgenic and knock-out animal models of HH pathway dysregulation. Furthermore, we summarize abnormalities in other tumor suppressors and oncogenes including ras and p53 and evidence for interactions between these regulatory genes and the HH pathway.