Hedgehog (Hh) signalling mediates axial patterning and stem cell fate in development. This is mediated by Sonic, Desert and Indian Hedgehogs whose morphogen gradients determine the level of signalling in recipient tissues. Aberrant, cell autonomous, ligand-dependent Hh signalling has recently been demonstrated in small cell lung cancer (SCLC), as well as in upper gastrointestinal malignancies arising from pancreas, esophagus and stomach. These tumors lack mutations in the Hh receptor PATCHED, identifying a mechanism of pathway activation distinct from Gorlin's syndrome associated neural and skin tumors. We believe that this phenomenon represents a conserved mechanism for establishing niche-independent stem cell fates in cancer which is essential for malignant transformation and metastasis. Specific inhibition of Hh signalling by the naturally occurring plant alkaloid cyclopamine provides the opportunity for pharmacologic assessment of the role of Hh signalling in these tumors. Cyclopamine inhibits growth of SCLC and a wide range of foregut derived malignancies both in vitro and in vivo. This demonstrates an ongoing requirement for Hh signalling in these highly lethal and aggressive tumors. A novel therapeutic strategy is proposed using pharmacologic targeting of Hh dependent tumors with high potency pathway antagonists.