Sonic hedgehog (Shh) signal transduction involves the ligand binding Patched1 (Ptc1) protein and a signaling component, Smoothened (Smo). A select group of compounds inhibits both Shh signaling, regulated by Ptc1, and late endosomal lipid sorting, regulated by the Ptc-related Niemann-Pick C1 (NPC1) protein. This suggests that Ptc1 regulates Smo activity through a common late endosomal sorting pathway also utilized by NPC1. During signaling, Ptc accumulates in endosomal compartments, but it is unclear if Smo follows Ptc into the endocytic pathway.