Mutations in hedgehog signaling pathway genes, especially PTC1 and SMO, are pivotal to the development of basal cell carcinomas. The study of basal cell carcinoma gene expression not only may elucidate mechanisms by which hedgehog signaling abnormalities produce aberrant tumor cell behavior but also can provide data on in vivo hedgehog target gene control in humans. We have found, in comparison with normal skin, that basal cell carcinomas have increased levels of mRNA for PTC1, GLI1, HIP, WNT2B, and WNT5a; decreased levels of mRNA for c-MYC, c-FOS, and WNT4; and unchanged levels of mRNA for PTC2, GLI2, WNT7B, and BMP2 and 4. These findings suggest that mutations in hedgehog signaling pathway genes may exert both cell autonomous and indirect effects and indicate that basal cell carcinoma tumor cells have a phenotype that at least in some aspects resembles that of epidermal stem cells.