Dicer, a ribonuclease III enzyme, is required for the maturation of microRNAs. To assess its role in cerebellar and medulloblastoma development, we genetically deleted Dicer in Nestin-positive neural progenitors and in mice lacking one copy for the Sonic Hedgehog receptor, Patched 1. We found that conditional loss of Dicer in mouse neural progenitors induced massive Trp53-independent apoptosis in all proliferative zones of the brain and decreased proliferation of cerebellar granule progenitors at embryonic day 15.5 leading to abnormal cerebellar development and perinatal lethality. Loss of one copy of Dicer significantly accelerated the formation of mouse medulloblastoma of the Sonic Hedgehog subgroup in Patched1-heterozygous mice. We conclude that Dicer is required for proper cerebellar development, and to restrain medulloblastoma formation.