Medulloblastoma is a malignant tumor that arises in the cerebellum in children, presumably by transformation of granule neuron precursor cells. In vivo models of medulloblastoma in genetically engineered mice have shown that activation of signal transduction pathways that stimulate proliferation and inhibit differentiation of neural progenitor cells during cerebellar development initiate medulloblastoma formation. Activation of the Sonic hedgehog (Shh)/Patched signaling pathway in the postnatal cerebellum is sufficient to induce medulloblastoma in mice. Activation of the phosphatidylinositol 3-kinase (PI3K) signaling pathway by insulin-like growth factor-II, inactivation of the p53 tumor suppressor protein, loss of DNA damage repair mechanisms, and ectopic expression of Myc oncoproteins cooperate with Shh/Patched signaling to enhance tumor formation in mice. Ectopic expression of alpha and beta interferons in the developing brain also induces Shh-mediated medulloblastoma formation, suggesting a possible role for antiviral response in the genesis of medulloblastoma. By revealing which cell signaling proteins can initiate medulloblastoma formation, mouse models have enabled investigators to identify molecular targets for designing new therapies. Small-molecule inhibitors of the Shh/Patched and PI3K pathways are potential chemotherapeutic agents for patients with medulloblastoma.