It has long been known that the overexpression of either Wnt-1 or the GLI proteins results in cancer; however, the molecular basis for this transformation was poorly understood. The Wnt-1 and GLI proteins have now been placed in a signaling cascade downstream of the mammalian homologs of the Drosophila hedgehog and patched proteins. The Drosophila segment polarity gene hedgehog (hh) encodes a secreted protein that appears to function in embryonic and imaginal disc patterning. The ptc gene, a