The Hedgehog (Hh) signaling pathway governs complex developmental processes, including proliferation and patterning within diverse tissues. These activities rely on a tightly regulated transduction system that converts graded Hh input signals into specific levels of pathway activity. Uncontrolled activation of Hh signaling drives tumor initiation and maintenance. However, recent entry of pathway-specific inhibitors into the clinic reveals mixed patient responses and thus prompts further exploration of pathway activation and inhibition. In this review, we share emerging insights into regulated and oncogenic Hh signaling, supplemented with updates on the development and use of Hh pathway-targeted therapies.