Breast cancer is the most common cause of cancer death among women worldwide. In order to improve the treatment of this disease, a more complete understanding of its biological basis is necessary. Since the Hedgehog (Hh) pathway was recently found to be required for growth and propagation of a number of different cancers, we discuss here the possible involvement of this pathway in the normal biology and development of cancer in the mammary gland. The use of mouse mammary cancer models has assisted the process of dissecting the mechanisms behind Hh-driven mammary tumour formation and growth. Based on recent studies, we conclude that the inhibition of Hh signalling in breast tumours may interfere with the maintenance of a putative cancer stem cell compartment and the abnormal stimulation of tumour stroma. Therefore, the components of the Hh signalling cascade may provide a set of drug targets, which could be implemented into novel combinatorial strategies for the treatment of breast cancer.