Cancer drug discovery has undergone a paradigm change over the past few years, from predominantly cytotoxic agent-based therapy to therapy aimed at genetic and molecular targets, thanks to a growing understanding of the genes and pathways responsible for cancer initiation and progression and to new drug discovery technologies. The success of drugs like trastuzumab, imatinib, gefitinib, and erlotinib has demonstrated that the targeting of specific oncogenic signal transduction pathways can be clinically useful. One such pathway, the Hedgehog-glioma-associated oncogene homologue zinc finger protein (Hh-Gli) signaling pathway, has attracted drug discovery scientists for the past decade. Hh-Gli signaling plays an important role in the embryonic patterning and development of many tissues and somatic structures as well as maintaining and repairing mature tissues in adults. Uncontrolled activation of the Hh-Gli pathway has been implicated in several cancers, including medulloblastoma, rhabdomyosarcoma, melanoma, basal cell carcinoma, and breast, lung, liver, stomach, prostate, and pancreatic cancers. Inhibition of the aberrant Hh-Gli pathway has thus emerged as an attractive target for anticancer therapy. One Hh pathway inhibitor has shown promising results in phase I clinical trials and is proceeding to phase II studies, and two other compounds have entered phase I clinical trials. In this article, we review the medicinal chemistry efforts to identify and design inhibitors of Hh-Gli signaling and present a perspective of future developments in this dynamic field. We also present a brief overview of the role of Hh-Gli signaling pathway in normal development and cancer.