In the absence of Hedgehog ligands, the Patched (PTCH) receptor inhibits the activity of Smoothened (SMO), a transmembrane protein. When a Hedgehog ligand binds to PTCH, this inhibition is relieved, allowing SMO to activate the downstream GLI transcription factors. These factors then translocate to the nucleus to regulate the expression of target genes involved in cell proliferation, survival, and differentiation.