About one-third of sporadic basal cell carcinomas (BCCs) of the skin and 10-15% of primitive neuroectodermal tumors (PNETs) of the central nervous system show mutations in the PTCH tumor suppressor gene. The PTCH gene product (Ptch) functions as a transmembrane receptor for the Sonic hedgehog protein (Shh) and interacts with another transmembrane protein called Smoh. To further elucidate the significance of alterations in the Shh signaling pathway, we investigated 31 sporadic BCCs and 15 PNETs for the mutation and/or expression of SMOH, PTCH, SHH, and GL11. In addition, we fine-mapped the SMOH gene locus by fluorescence in situ hybridization to chromosomal band 7q32. Mutational analysis identified four BCCs with somatic missense mutations in SMOH affecting codon 535 (TGG==>TTG: Trp==>Leu) in three tumors and codon 199 (CGG==>TGG: Arg==>Trp) in one tumor. A missense mutation at codon 533 (AGC==>AAC: Ser==>Asn) was found in one PNET. PTCH mutations were detected in eight BCCs and one PNET. Two BCCs demonstrated mutations in both SMOH and PTCH. The majority of tumors showed an increased expression of SMOH, PTCH, and GL11 transcripts as compared with that of normal skin and nonneoplastic brain tissue, respectively. In contrast, only one BCC and one PNET expressed SHH mRNA at levels detectable by reverse transcription-PCR, and no SHH gene mutations were found. In summary, our results indicate that both PTCH and SMOH represent important targets for genetic alterations in sporadic BCCs and PNETs.