Since its discovery by C. Nüsslein-Volhard and E. F. Wieschaus, hedgehog (hh) signaling has come a long way. Today it is regarded as a key regulator in embryogenesis where it governs processes like cell proliferation, differentiation, and tissue patterning. Furthermore, in adults it is involved in the maintenance of stem cells, and in tissue repair and regeneration. But hh signaling has a second—much darker—face: it plays an important role in several types of human cancers where it promotes growth and enables proliferation of tumor stem cells. The etiology of medulloblastoma and basal cell carcinoma is tightly linked to aberrant hh activity, but also cancers of the prostate, the pancreas, the colon, the breasts, rhabdomyosarcoma, and leukemia, are dependent on irregular hh activity. Recent clinical studies have shown that hh signaling can be the basis of an important new class of therapeutic agents with far-reaching implications in oncology. Thus, modulation of hh signaling by means of small molecules has emerged as a valuable tool in combating these hh-dependent cancers. Cyclopamine, a unique natural product with a fascinating history, was the first identified inhibitor of hh signaling and its story is closely linked to the progress in the whole field. In this review we will trace the story of cyclopamine, give an overview on the biological modes of hh signaling both in untransformed and malignant cells, and finally present potent modulators of the hh pathway—many of them already in clinical studies. For more than 30 years now the knowledge on hh signaling has grown steadily—an end to this development is far from being conceivable.