Xeroderma pigmentosum (XP), a rare hereditary syndrome, is characterized by a hypersensitivity to solar irradiation due to a defect in nucleotide excision repair resulting in a predisposition to squamous and basal cell carcinomas as well as malignant melanomas appearing at a very early age. The mutator phenotype of XP cells is evident by the higher levels of UV specific modifications found in key regulatory genes in XP skin tumors compared to those in the same tumor types from the normal population. Thus, XP provides a unique model for the study of unrepaired DNA lesions, mutations and skin carcinogenesis. The high level of ras oncogene activation, Ink4a-Arf and p53 tumor suppressor gene modifications as well as alterations of the different partners of the mitogenic sonic hedgehog signaling pathway (patched, smoothened and sonic hedgehog), characterized in XP skin tumors have clearly demonstrated the major role of the UV component of sunlight in the development of skin tumors. The majority of the mutations are C to T or tandem CC to TT UV signature transitions, occurring at bipyrimidine sequences, the specific targets of UV induced lesions. These characteristics are also found in the same genes modified in sporadic skin cancers but with lower frequencies confirming the validity of studying the XP model. The knowledge gained by studying XP tumors has given us a greater perception of the contribution of genetic predisposition to cancer as well as the consequences of the many alterations which modulate the activities of different genes affecting crucial pathways vital for maintaining cell homeostasis.