The Hedgehog (Hh) family of lipid-modified signaling proteins directs embryonic tissue patterning and postembryonic tissue homeostasis, and dysregulated Hh signaling drives familial and sporadic cancers. Hh ligands bind to and inhibit the tumor suppressor Patched and allow the oncoprotein Smoothened (SMO) to accumulate in cilia, which in turn activates the GLI family of transcription factors. Recent work has demonstrated that endogenous cholesterol and oxidized cholesterol derivatives (oxysterols) bind and modulate SMO activity. Here we discuss the myriad sterols that activate or inhibit the Hh pathway, with emphasis on endogenous 24(S),25-epoxycholesterol and 3β,5α-dihydroxycholest-7-en-6-one, and propose models of sterol regulation of SMO. Synthetic inhibitors of SMO have long been the focus of drug development efforts. Here, we discuss the possible utility of steroidal SMO ligands or inhibitors of enzymes involved in sterol metabolism as cancer therapeutics.