Cholesterylation is a post-translational attachment of sterol to proteins. This modification has been a characteristic of a single family of hedgehog proteins (Hh). Hh is a well-established morphogenic molecule important in embryonic development. It was also found to be involved in the progression of many cancer types. Herein, we describe the mechanism of biosynthesis of cholesterylated Hh, the role of this unusual modification on protein functions and novel chemical probes, which could be used to specifically target this modification, both in vitro and in vivo.