The role of the zinc site in the N-terminal fragment of human Sonic hedgehog (ShhN) was explored by comparing the biophysical and functional properties of wild-type ShhN with those of mutants in which the zinc-coordinating residues H140, D147, and H182, or E176 which interacts with the metal ion via a bridging water molecule, were mutated to alanine. The wild-type and E176A mutant proteins retained 1 mol of zinc/mol of protein after extensive dialysis, whereas the H140A and D147A mutants retained only 0.03 and 0.05 mol of zinc/mol of protein, respectively. Assay of the wild-type and mutant proteins in two activity assays indicated that the wild-type and E176A mutant proteins had similar activity, whereas the H140A and D147A mutants were significantly less active. These assays also indicated that the H140A and D147A mutants were susceptible to proteolysis. CD, fluorescence, and (1)H NMR spectra of the H140A, D147A, and E176A mutants measured at 20 or 25 degrees C were very similar to those observed for wild-type ShhN. However, CD measurements at 37 degrees C showed evidence of some structural differences in the H140A and D147A mutants. Guanidine hydrochloride (GuHCl) denaturation studies revealed that the loss of zinc from the H140A and D147A mutants destabilized the folded proteins by approximately 3.5 kcal/mol, comparable to the effect of removing zinc from wild-type ShhN by treatment with EDTA. Thermal melting curves of wild-type ShhN gave a single unfolding transition with a midpoint T(m) of approximately 59 degrees C, whereas both the H140A and D147A mutants displayed two distinct transitions with T(m) values of 37-38 and 52-54 degrees C, similar to that observed for EDTA-treated wild-type ShhN. Addition of zinc to the H140A and D147A mutants resulted in a partial restoration of stability against thermal and GuHCl denaturation. The ability of these mutants to bind zinc was confirmed using a fluorescence-based binding assay that indicated that they bound zinc with K(d) values of approximately 1.6 and approximately 15 nM, respectively, as compared to a value of </=100 pM for wild-type ShhN. The properties of the E176A mutant were indistinguishable from those of wild-type ShhN in all biophysical and functional assays, indicating that this residue does not contribute significantly to stabilization of the zinc-binding site and that ShhN does not require hydrolase activity for in vitro biological function.