Cilia play important roles in many developmental and physiological processes. However, the genetic and cell biological control of ciliogenesis remains poorly understood. Here, we show that the zebrafish iguana gene is required for differentiation of primary cilia. iguana encodes a zinc finger and coiled-coil containing protein, previously implicated in Hedgehog signaling. We now argue that aberrant Hedgehog activity in iguana -deficient zebrafish arises from their profound lack of primary cilia. By contrast, the requirement of iguana for motile cilia formation is less obligatory. In the absence of iguana function, basal bodies can migrate to the cell surface and appear to engage with the apical membrane. However, formation of ciliary pits and axonemal outgrowth is completely inhibited. Iguana localizes to the base of primary and motile cilia, in the immediate vicinity or closely associated with the basal bodies. These findings identify the Iguana protein as a novel and critical component of ciliogenesis.