In the absence of Hedgehog ligands, the PTCH receptor inhibits SMO, preventing the activation of Gli transcription factors. When a Hedgehog ligand binds to PTCH, this inhibition is relieved, allowing SMO to become active. Activated SMO then initiates a cascade of intracellular events that culminate in the activation of Gli transcription factors, which enter the nucleus and modulate the expression of target genes involved in cell proliferation, differentiation, and survival.