Peroxisomal cholesterol biosynthesis and Smith-Lemli-Opitz syndrome

Smith-Lemli-Opitz syndrome (SLOS), caused by 7-dehydrocholesterol-reductase (DHCR7) deficiency, shows variable severity independent of DHCR7 genotype. To test whether peroxisomes are involved in alternative cholesterol synthesis, we used [1-(14)C]C24:0 for peroxisomal beta-oxidation to generate [1-(14)C]acetyl-CoA as cholesterol precursor inside peroxisomes. The HMG-CoA reductase inhibitor lovastatin suppressed cholesterol synthesis from [2-(14)C]acetate and [1-(14)C]C8:0 but not from [1-(14)C]C24:0, implicating a peroxisomal, lovastatin-resistant HMG-CoA reductase. In SLOS fibroblasts lacking DHCR7 activity, no cholesterol was formed from [1-(14)C]C24:0-derived [1-(14)C]acetyl-CoA, indicating that the alternative peroxisomal pathway also requires this enzyme. Our results implicate peroxisomes in cholesterol biosynthesis but provide no link to phenotypic variation in SLOS.     

Mutations in the human sterol delta7-reductase gene at 11q12-13 cause Smith-Lemli-Opitz syndrome.

The Smith-Lemli-Opitz syndrome (SLOS; also known as "RSH syndrome" [MIM 270400]) is an autosomal recessive multiple malformation syndrome due to a defect in cholesterol biosynthesis. Children with SLOS have elevated serum 7-dehydrocholesterol (7-DHC) levels and typically have low serum cholesterol levels. On the basis of this biochemical abnormality, it has been proposed that mutations in the human sterol Delta7-reductase (7-DHC reductase; E.C.1.3.1.21) gene cause SLOS. However, one could also propose a defect in a gene that encodes a protein necessary for either the expression or normal function of sterol Delta7-reductase. We cloned cDNA encoding a human sterol Delta7-reductase (DHCR7) on the basis of its homology with the sterol Delta7-reductase from Arabidopsis thaliana, and we confirmed the enzymatic function of the human gene product by expression in SLOS fibroblasts. SLOS fibroblasts transfected with human sterol Delta7-reductase cDNA showed a significant reduction in 7-DHC levels, compared with those in SLOS fibroblasts transfected with the vector alone. Using radiation-hybrid mapping, we show that the DHCR7 gene is encoded at chromosome 11q12-13. To establish that defects in this gene cause SLOS, we sequenced cDNA clones from SLOS patients. In three unrelated patients we have identified four different mutant alleles. Our results demonstrate both that the cDNA that we have identified encodes the human sterol Delta7-reductase and that mutations in DHCR7 are responsible for at least some cases of SLOS.     

Cholesterol biosynthesis from birth to adulthood in a mouse model for 7-dehydrosterol reductase deficiency (Smith-Lemli-Opitz syndrome)

Smith-Lemli-Opitz syndrome (SLOS) is caused by deficiency in the terminal step of cholesterol biosynthesis, which is catalyzed by 7-dehydrocholesterol reductase (DHCR7). The disorder exhibits several phenotypic traits including dysmorphia and mental retardation with a broad range of severity. Pathogenesis of SLOS is complex due to multiple roles of cholesterol and may be further complicated by unknown effects of aberrant metabolites that arise when 7-dehydrocholesterol (7-DHC), the substrate for DHCR7, accumulates. A viable mouse model for SLOS has recently been developed, and here we characterize cholesterol metabolism in this model with emphasis on changes during the first few weeks of postnatal development. Cholesterol and 7-DHC were measured in "SLOS" mice and compared with measurements in normal mice. SLOS mice had measurable levels of 7-DHC at all ages tested (up to 1 year), while 7-DHC was below the threshold for detection in normal mice. In perinatal to weaning age SLOS mice, cholesterol and 7-DHC levels changed dramatically. Changes in brain and liver were independent; in brain cholesterol increased several fold while 7-DHC remained relatively constant, but in liver cholesterol first increased then decreased again while 7-DHC first decreased then increased. In older SLOS animals the ratio of 7-DHC/cholesterol, which is an index of biochemical severity, tended to approach, but not reach, normal. While these mice provide the best available genetic animal model for the study of SLOS pathogenesis and treatment, they probably will be most useful at early ages when the metabolic effects of the mutations are most dramatic. To correlate any experimental treatment with improved sterol metabolism will require age-matched controls. Finally, determining the mechanism by which these "SLOS" mice tend to normalize may provide insight into the future development of therapy.     

Roles for Hedgehog signaling in androgen production and prostate ductal morphogenesis

Previous studies have demonstrated that the Hedgehog (Hh) signaling pathway plays a critical role in the development and patterning of many endodermally derived tissues. We have investigated the role of Sonic hedgehog (Shh) in formation of the prostate gland by examining the urogenital phenotype of Shh mutant fetuses. Consistent with earlier work reporting an essential role for Shh in prostate induction, we have found that Shh mutant fetuses display abnormal urogenital development and fail to form prostate buds. Unexpectedly, however, we have discovered that this prostate defect could be rescued by three different methods: renal grafting, explant culture in the presence of androgens, and administration of dihydrotestosterone (DHT) to pregnant mice, indicating that the prostate defect in Shh mutants is due to insufficient levels of androgens. Furthermore, we find that the inhibition of Hh pathway signaling by treatment with cyclopamine does not block prostate formation in explant culture, but instead produces morphological defects consistent with a role for Hh signaling in ductal patterning. Taken together, our studies indicate that the initial organogenesis of the prostate proceeds independently of Shh, but that Shh or other Hh ligands may play a role in subsequent events that pattern the prostate.     

Cardiac and CNS defects in a mouse with targeted disruption of suppressor of fused

The hedgehog (Hh) pathway is conserved from Drosophila to humans and plays a key role in embryonic development. In addition, activation of the pathway in somatic cells contributes to cancer development in several tissues. Suppressor of fused is a negative regulator of Hh signaling. Targeted disruption of the murine suppressor of fused gene (Sufu) led to a phenotype that included neural tube defects and lethality at mid-gestation (9.0-10.5 dpc). This phenotype resembled that caused by loss of patched (Ptch1), another negative regulator of the Hh pathway. Consistent with this finding, Ptch1 and Sufu mutants displayed excess Hh signaling and resultant altered dorsoventral patterning of the neural tube. Sufu mutants also had abnormal cardiac looping, indicating a defect in the determination of left-right asymmetry. Marked expansion of nodal expression in 7.5 dpc embryos and variable degrees of node dysmorphology in 7.75 dpc embryos suggested that the pathogenesis of the cardiac developmental abnormalities was related to node development. Other mutants of the Hh pathway, such as Shh, Smo and Shh/Ihh compound mutants, also have laterality defects. In contrast to Ptch1 heterozygous mice, Sufu heterozygotes had no developmental defects and no apparent tumor predisposition. The resemblance of Sufu homozygotes to Ptch1 homozygotes is consistent with mouse Sufu being a conserved negative modulator of Hh signaling.     

Biochemical and genetic aspects of 7-dehydrocholesterol reductase and Smith-Lemli-Opitz syndrome

In recent years, several inherited human disorders caused by defects in cholesterol biosynthesis have been identified. These are characterized by malformations, multiple congenital anomalies, mental and growth retardation and/or skeletal and skin abnormalities indicating a pivotal role of cholesterol in morphogenesis and embryonic development. The first recognized and most common of these developmental disorders is Smith-Lemli-Opitz syndrome, an autosomal recessive trait caused by mutations in the DHCR7 gene resulting in a deficiency of the encoded sterol Delta(7)-reductase, alternatively called 7-dehydrocholesterol reductase (EC 1.3.1.21). This enzyme catalyzes the final step in cholesterol biosynthesis, which is the reduction of the Delta(7) double bond of 7-dehydrocholesterol to produce cholesterol.     

Mutational spectrum in the Delta7-sterol reductase gene and genotype-phenotype correlation in 84 patients with Smith-Lemli-Opitz syndrome

Smith-Lemli-Opitz syndrome (SLOS), an autosomal recessive malformation syndrome, ranges in clinical severity from mild dysmorphism and moderate mental retardation to severe congenital malformation and intrauterine lethality. Mutations in the gene for Delta7-sterol reductase (DHCR7), which catalyzes the final step in cholesterol biosynthesis in the endoplasmic reticulum (ER), cause SLOS. We have determined, in 84 patients with clinically and biochemically characterized SLOS (detection rate 96%), the mutational spectrum in the DHCR7 gene. Forty different SLOS mutations, some frequent, were identified. On the basis of mutation type and expression studies in the HEK293-derived cell line tsA-201, we grouped mutations into four classes: nonsense and splice-site mutations resulting in putative null alleles, missense mutations in the transmembrane domains (TM), mutations in the 4th cytoplasmic loop (4L), and mutations in the C-terminal ER domain (CT). All but one of the tested missense mutations reduced protein stability. Concentrations of the cholesterol precursor 7-dehydrocholesterol and clinical severity scores correlated with mutation classes. The mildest clinical phenotypes were associated with TM and CT mutations, and the most severe types were associated with 0 and 4L mutations. Most homozygotes for null alleles had severe SLOS; one patient had a moderate phenotype. Homozygosity for 0 mutations in DHCR7 appears compatible with life, suggesting that cholesterol may be synthesized in the absence of this enzyme or that exogenous sources of cholesterol can be used.     

Sterol and oxysterol synthases near the ciliary base activate the Hedgehog pathway

Vertebrate Hedgehog signals are transduced through the primary cilium, a specialized lipid microdomain that is required for Smoothened activation. Cilia-associated sterol and oxysterol lipids bind to Smoothened to activate the Hedgehog pathway, but how ciliary lipids are regulated is incompletely understood. Here we identified DHCR7, an enzyme that produces cholesterol, activates the Hedgehog pathway, and localizes near the ciliary base. We found that Hedgehog stimulation negatively regulates DHCR7 activity and removes DHCR7 from the ciliary microenvironment, suggesting that DHCR7 primes cilia for Hedgehog pathway activation. In contrast, we found that Hedgehog stimulation positively regulates the oxysterol synthase CYP7A1, which accumulates near the ciliary base and produces oxysterols that promote Hedgehog signaling in response to pathway activation. Our results reveal that enzymes involved in lipid biosynthesis in the ciliary microenvironment promote Hedgehog signaling, shedding light on how ciliary lipids are established and regulated to transduce Hedgehog signals.     

Cholesterol metabolism is required for intracellular hedgehog signal transduction in vivo

We describe the rudolph mouse, a mutant with striking defects in both central nervous system and skeletal development. Rudolph is an allele of the cholesterol biosynthetic enzyme, hydroxysteroid (17-beta) dehydrogenase 7, which is an intriguing finding given the recent implication of oxysterols in mediating intracellular Hedgehog (Hh) signaling. We see an abnormal sterol profile and decreased Hh target gene induction in the rudolph mutant, both in vivo and in vitro. Reduced Hh signaling has been proposed to contribute to the phenotypes of congenital diseases of cholesterol metabolism. Recent in vitro and pharmacological data also indicate a requirement for intracellular cholesterol synthesis for proper regulation of Hh activity via Smoothened. The data presented here are the first in vivo genetic evidence supporting both of these hypotheses, revealing a role for embryonic cholesterol metabolism in both CNS development and normal Hh signaling.     

Retinal ganglion cell-derived sonic hedgehog signaling is required for optic disc and stalk neuroepithelial cell development

The development of optic stalk neuroepithelial cells depends on Hedgehog (Hh) signaling, yet the source(s) of Hh protein in the optic stalk is unknown. We provide genetic evidence that sonic hedgehog (Shh) from retinal ganglion cells (RGCs) promotes the development of optic disc and stalk neuroepithelial cells. We demonstrate that RGCs express Shh soon after differentiation, and cells at the optic disc in close proximity to the Shh-expressing RGCs upregulate Hh target genes, which suggests they are responding to RGC-derived Shh signaling. Conditional ablation of Shh in RGCs caused a complete loss of optic disc astrocyte precursor cells, resulting in defective axon guidance in the retina, as well as conversion of the neuroepithelial cells in the optic stalk to pigmented cells. We further show that Shh signaling modulates the size of the Pax2(+) astrocyte precursor cell population at the optic disc in vitro. Together, these data provide a novel insight into the source of Hh that promotes neuroepithelial cell development in the mammalian optic disc and stalk.     

Ubr3, a Novel Modulator of Hh Signaling Affects the Degradation of Costal-2 and Kif7 through Poly-ubiquitination

Hedgehog (Hh) signaling regulates multiple aspects of metazoan development and tissue homeostasis, and is constitutively active in numerous cancers. We identified Ubr3, an E3 ubiquitin ligase, as a novel, positive regulator of Hh signaling in Drosophila and vertebrates. Hh signaling regulates the Ubr3-mediated poly-ubiquitination and degradation of Cos2, a central component of Hh signaling. In developing Drosophila eye discs, loss of ubr3 leads to a delayed differentiation of photoreceptors and a reduction in Hh signaling. In zebrafish, loss of Ubr3 causes a decrease in Shh signaling in the developing eyes, somites, and sensory neurons. However, not all tissues that require Hh signaling are affected in zebrafish. Mouse UBR3 poly-ubiquitinates Kif7, the mammalian homologue of Cos2. Finally, loss of UBR3 up-regulates Kif7 protein levels and decreases Hh signaling in cultured cells. In summary, our work identifies Ubr3 as a novel, evolutionarily conserved modulator of Hh signaling that boosts Hh in some tissues.     

Multiple roles for Hedgehog signaling in zebrafish pituitary development

The endocrine-secreting lobe of the pituitary gland, or adenohypophysis, forms from cells at the anterior margin of the neural plate through inductive interactions involving secreted morphogens of the Hedgehog (Hh), fibroblast growth factor (FGF), and bone morphogenetic protein (BMP) families. To better understand when and where Hh signaling influences pituitary development, we have analyzed the effects of blocking Hh signaling both pharmacologically (cyclopamine treatments) and genetically (zebrafish Hh pathway mutants). While current models state that Shh signaling from the oral ectoderm patterns the pituitary after placode induction, our data suggest that Shh plays a direct early role in both pituitary induction and patterning, and that early Hh signals comes from adjacent neural ectoderm. We report that Hh signaling is necessary between 10 and 15 h of development for induction of the zebrafish adenohypophysis, a time when shh is expressed only in neural tissue. We show that the Hh responsive genes ptc1 and nk2.2 are expressed in preplacodal cells at the anterior margin of the neural tube at this time, indicating that these cells are directly receiving Hh signals. Later (15-20 h) cyclopamine treatments disrupt anterior expression of nk2.2 and Prolactin, showing that early functional patterning requires Hh signals. Consistent with a direct role for Hh signaling in pituitary induction and patterning, overexpression of Shh results in expanded adenohypophyseal expression of lim3, expansion of nk2.2 into the posterior adenohypophysis, and an increase in Prolactin- and Somatolactin-secreting cells. We also use the zebrafish Hh pathway mutants to document the range of pituitary defects that occur when different elements of the Hh signaling pathway are mutated. These defects, ranging from a complete loss of the adenohypophysis (smu/smo and yot/gli2 mutants) to more subtle patterning defects (dtr/gli1 mutants), may correlate to human Hh signaling mutant phenotypes seen in Holoprosencephaly and other congenital disorders. Our results reveal multiple and distinct roles for Hh signaling in the formation of the vertebrate pituitary gland, and suggest that Hh signaling from neural ectoderm is necessary for induction and functional patterning of the vertebrate pituitary gland.     

Proliferation of Murine Midbrain Neural Stem Cells Depends upon an Endogenous Sonic Hedgehog (Shh) Source

The Sonic Hedgehog (Shh) pathway is responsible for critical patterning events early in development and for regulating the delicate balance between proliferation and differentiation in the developing and adult vertebrate brain. Currently, our knowledge of the potential role of Shh in regulating neural stem cells (NSC) is largely derived from analyses of the mammalian forebrain, but for dorsal midbrain development it is mostly unknown. For a detailed understanding of the role of Shh pathway for midbrain development in vivo, we took advantage of mouse embryos with cell autonomously activated Hedgehog (Hh) signaling in a conditional Patched 1 (Ptc1) mutant mouse model. This animal model shows an extensive embryonic tectal hypertrophy as a result of Hh pathway activation. In order to reveal the cellular and molecular origin of this in vivo phenotype, we established a novel culture system to evaluate neurospheres (nsps) viability, proliferation and differentiation. By recreating the three-dimensional (3-D) microenvironment we highlight the pivotal role of endogenous Shh in maintaining the stem cell potential of tectal radial glial cells (RGC) and progenitors by modulating their Ptc1 expression. We demonstrate that during late embryogenesis Shh enhances proliferation of NSC, whereas blockage of endogenous Shh signaling using cyclopamine, a potent Hh pathway inhibitor, produces the opposite effect. We propose that canonical Shh signaling plays a central role in the control of NSC behavior in the developing dorsal midbrain by acting as a niche factor by partially mediating the response of NSC to epidermal growth factor (EGF) and fibroblast growth factor (FGF) signaling. We conclude that endogenous Shh signaling is a critical mechanism regulating the proliferation of stem cell lineages in the embryonic dorsal tissue.     

Sonic hedgehog is produced by follicular dendritic cells and protects germinal center B cells from apoptosis

The Hedgehog (Hh) signaling pathway is involved in the development of many tissues during embryogenesis, but has also been described to function in adult self-renewing tissues. In the immune system, Sonic Hedgehog (Shh) regulates intrathymic T cell development and modulates the effector functions of peripheral CD4(+) T cells. In this study we investigate whether Shh signaling is involved in peripheral B cell differentiation in mice. Shh is produced by follicular dendritic cells, mainly in germinal centers (GCs), and GC B cells express both components of the Hh receptor, Patched and Smoothened. Blockade of the Hh signaling pathway reduces the survival, and consequently the proliferation and Ab secretion, of GC B cells. Furthermore, Shh rescues GC B cells from apoptosis induced by Fas ligation. Taken together, our data suggest that Shh is one of the survival signals provided by follicular dendritic cells to prevent apoptosis in GC B cells.     

Sonic hedgehog regulates early human thymocyte differentiation by counteracting the IL-7-induced development of CD34+ precursor cells

The Hedgehog (Hh) family of signaling molecules normally functions in the development of numerous tissues by regulating cellular differentiation and proliferation. Recent results have demonstrated that the different components of the Hh signaling pathway are expressed in the human thymus. In this study, we investigate the potential role of Sonic hedgehog (Shh) in human intrathymic T cell maturation. Results show that the expression of the two components of the Hh receptor, Patched and Smoothened, is mostly restricted to CD34+ precursor cells that are committing to the T cell lineage. Shh significantly increased the viability of CD34+ T cell precursors modulating bcl-2 and bax protein expression, and also inhibited their proliferation. The treatment of chimeric human-mouse fetal thymus organ cultures with Shh resulted in an arrested thymocyte differentiation and an accumulation of CD34+ progenitor cells. This effect was mainly attributed to the ability of Shh to counteract the IL-7-induced proliferation and differentiation of CD34+ cells. Shh down-regulated in the precursor cell population the expression of IL-7R as well as stromal-derived factor-1 chemokine receptor, CXCR4, and inhibited IL-7-dependent STAT5 phosphorylation. Therefore, Shh may function as a maintenance factor for intrathymic CD34+ precursor cells.     

Kinetic and structural studies on interactions between heparin or heparan sulfate and proteins of the hedgehog signaling pathway

Heparan sulfate (HS) proteoglycans (PGs) interact with a number of extracellular signaling proteins, thereby playing an essential role in the regulation of many physiological processes. These interactions are important for both normal signal transduction and regulation of the tissue distribution of signaling molecules. In this study, we use surface plasmon resonance (SPR) to study interactions of HS and structurally related heparin with proteins in the Hedgehog signaling pathway. SPR analysis shows that heparin binds with different affinities to active fragments of the proteins Hedgehog (Hh), Interference Hedgehog (Ihog), Cam-related/Down-regulated by Oncogenes (CDO), and Sonic Hedgehog (Shh). Solution competition studies show that the minimum size of a heparin oligosaccharide capable of interacting with Ihog is larger than a tetrasaccharide and for interacting with Shh is larger than an octasaccharide. In comparison with heparin, Ihog and Shh exhibited a lower affinity for HS than for heparin, and CDO and Hh exhibit negligible binding to HS. This study clearly demonstrates Shh and Ihog are heparin and HS binding proteins and that both molecules preferentially bind heparin or HS having a high level of sulfation.     

Ultraviolet A sensitivity in Smith-Lemli-Opitz syndrome: Possible involvement of cholesta-5,7,9(11)-trien-3 beta-ol

Smith-Lemli-Opitz syndrome (SLOS) is a severe developmental disorder caused by mutations in the DHCR7 gene coding for 7-dehydrocholesterol (7-DHC) reductase, the enzyme involved in the last step of cholesterol biosynthesis. SLOS homozygotes exhibit marked deficiency of cholesterol in plasma and tissues with concomitant increase in 7-DHC. Ultraviolet A (UVA) photosensitivity has been recognized as part of SLOS with maximal response occurring at 350 nm. 7-DHC itself has no UVA absorption and so cannot be the direct cause of SLOS photosensitivity. However, cholesta-5,7,9(11)-trien-3beta-ol (9-DDHC), a metabolite of 7-DHC, has been detected in plasma from SLOS patients. Because 9-DDHC has strong absorption in the UVA range (approximately 15,000 @ 324 nm), we have examined its photobiology to determine whether it could be involved in SLOS photosensitivity. High levels of 7-DHC (0.65 mg/100 g wet weight) and measurable amounts of 9-DDHC (0.042 mg/100 g wet weight) were found in skin lipids extracted from CD-1 mice treated with AY9944 (trans-1,4-bis(2-chlorobenzylaminomethyl)cyclohexane dihydrochloride), an inhibitor of 7-DHC reductase. Human HaCaT keratinocytes treated with 9-DDHC (10 microM) and then immediately exposed to UVA (15 J/cm2) exhibited an 88% decrease in viability (compared to dark controls). No damage was observed in cells exposed to 7-DHC/UVA or UVA alone. However, HaCaT keratinocytes treated with 7-DHC (5 microM) for 15 h and then exposed to UVA (30 J/cm2) were damaged. 9-DDHC was detected in keratinocytes incubated with 7-DHC. Reactive oxygen species were detected in 9-DDHC/UVA-exposed cells using the fluorescent probe 5-(and 6-)-chloromethyl-2',7'-dichlorodihydrofluorescein diacetate acetyl ester. Singlet oxygen was generated when 9-DDHC was UVA irradiated in CCl4. UVA irradiation of 9-DDHC in acetonitrile generated superoxide and carbon-centered and alkoxyl radicals which were trapped by 5,5-dimethyl-1-pyrroline N-oxide. These findings suggest that reactive oxygen species generated by 9-DDHC may play a role in the UVA skin photosensitivity of SLOS patients. Furthermore, several statin drugs inhibit 7-DHC reductase, in addition to hydroxymethylglutaryl-CoenzymeA reductase, so that 9-DDHC may also be responsible for statin-derived photosensitivity, dermatoses, and cataract formation. Finally, we have previously detected 9-DDHC in skin lipids from normal subjects, so this sterol may also be the skin chromophore responsible for skin photoaging and UV-induced skin cancer.     

Conserved expression control and shared activity between cognate T-box genes Tbx2 and Tbx3 in connection with Sonic hedgehog signaling during Xenopus eye development

Tbx2 and Tbx3 are considered to be cognate genes within a Tbx2/3/4/5 subfamily of T-box genes and are expressed in closely overlapping areas in a variety of tissues, including the eye. Herein, we show that misexpression of Tbx2 and Tbx3 in Xenopus embryos gave rise to defective eye morphogenesis, which was reminiscent of the defect caused by attenuated Sonic hedgehog (Shh) signaling. Indeed, Tbx2/3 misexpression suppressed Gli1, Gli2, Ptc2 and Pax2, mediators or targets of Hedgehog (Hh) signals. From these data, Tbx2/3 may have a shared function in inhibiting Gli-dependent Shh signaling during eye development. Conversely, the expression of Tbx2/3 was severely affected by both Shh and a putative dominant negative form of Hh, as well as by both transactivator and transrepressor forms of Gli-fusion proteins, suggesting that the expression of Tbx2/3 may be regulated by a Gli-dependent Hh signal transduction pathway. Because the Shh signal has been considered to play crucial roles in the formation of the proximal-distal and dorsal-ventral axes in the eyes, these findings about the mutual regulatory mechanism between Tbx2/3 and Gli-dependent Hh signaling provide valuable insight into the cause of the localized expression of Tbx2/3 and their role during the formation of these axes. In addition, our findings also imply the conserved regulation and shared activity between the cognate genes of Tbx2 and Tbx3.     

A highly conserved amino-terminal region of sonic hedgehog is required for the formation of its freely diffusible multimeric form

Although members of the Hedgehog (Hh) family were initially described as morphogens, many of these early conclusions were based on experiments that used non-physiologically relevant forms of Hh. Native Hh is modified by cholesterol (HhNp) and palmitate. These hydrophobic modifications are responsible for the ability of Hh to associate with cellular membranes, a property that initially appeared inconsistent with its ability to act far from its site of synthesis. Although it is now clear that Hh family members are capable of acting directly in long-range signaling, the form of Hh capable of this activity remains controversial. We have previously provided evidence for a freely diffusible multimeric form of Sonic Hedgehog (Shh) termed s-ShhNp, which is capable of accumulating in a gradient fashion through a morphogenic field. Here, we provide further evidence that s-ShhNp is the physiologically relevant form of Shh. We show that the biological activity of freely diffusible ShhNp resides in its multimeric form and that this multimeric form is exceedingly stable, even to high concentrations of salt and detergent. Furthermore, we now validate the Shh-Shh interactions previously observed in the crystal structure of human Shh, showing that a highly conserved amino-terminal domain of Shh is important for the formation of s-ShhNp. We also conclusively show that palmitoylation is required for s-ShhNp formation. Thus, our results identify both protein-protein and protein-lipid interactions that are required for s-ShhNp formation, and provide the first structural analyses supporting the existence of Shh multimers.