The pathogenesis of medulloblastoma (MB), the most common and aggressive brain tumor in children, is poorly understood. MB tumors respond to factors secreted by cerebellar Purkinje neurons such as Sonic hedgehog (Shh) and Wnt3a. Understanding the modulation of Shh/Wnt signaling is critical to developing new MB treatments. Shh and Wnt3a induce MB cell proliferation, and bind heparan sulfate glycosaminoglycan chains (HS-GAG). HS-GAG are components of syndecans: cell surface HS proteoglycans (HSPG) which act as co-receptors for extracellular matrix based ligands, and are targets of heparanase (HPSE). We hypothesized that extracellular HPSE activity can modulate MB intracellular signaling of Shh/Wnt3a, involving syndecans 1/4 carboxy terminal-associated proteins and downstream targets. We compared the regulation of Shh/Wnt3a signaling subsequent to treatment with exogenous human active HPSE in MB lines possessing increased invasive abilities. We identified GEF-H1, a small GTPase guanine nucleotide exchange factor, as a new component of a syndecan signaling complex. Secondly, we demonstrated that HPSE modulated Shh/Wnt3 dependent expression and intracellular distribution of GEF-H1, β-catenin, and N-Myc. Thirdly, HPSE modulated Shh/Wnt3a - dependent gene expression of HSPG and Gli transcription factors. Fourthly, pretreatment with HPSE, alone or prior to Shh/Wnt3a exposure, altered small GTPase (Rac1/RhoA) activities differentially, and promoted RhoA activation. Finally, the differential regulation of Rac1/RhoA activities by HPSE affected MB cell proliferation and invasion. Our results indicate that the HPSE/HSPG axis is implicated in critical MB cell signaling pathways with potential relevance for MB treatment.