Hedgehog (Hh) signaling pathway is one of the universal pathways involved in animal development. This dissertation focuses on Hh role in the mammalian gonad development, which is a central part of mammalian sexual development and identity. The central dogma of mammalian sex development is that genetic sex determines the gonadal sex, which in turn through hormones determines the phenotypic and behavioral sex of male and female. In most mammals, contrary to lower vertebrates, sex is determined exclusively by the expression of "Sry" (Sex-determining Region on Y chromosome) gene in the primordial gonad. Desert Hedgehog ("Dhh"), one gene expressed downstream of "Sry" in the fetal testis, is one of the three paralogs of the mammalian Hedgehog signaling family that include other two genes: Sonic Hedgehog ("Shh") and Indian Hedgehog ("Ihh"). "Dhh" has been reported to play an essential role in the development of the androgen-producing fetal Leydig cells (FLCs), with subsequent impact on adult testis function and fertility. However, other signaling and transcriptional factors have been also implicated in FLC differentiation in mouse. This raised the question of whether Hh signaling alone or with other pathways is able to induce FLC differentiation. Additionally, Hh signaling (mainly Shh) has been shown to affect target cells through its intracellular components. Of these components are the GLI proteins (GLI1-3) that control gene transcription in target cells. GLI1 and GLI2 were mainly reported as activators of gene transcription, while GLII3 was reported mainly as a transcriptional repressor. This raises another question of whether the gonadal Dhh signaling uses these different GLI proteins in fetal gonad development to transmit the intracellular signal or not. The "main hypothesis" of this dissertation was that gonadal Hh signaling, through the putative mammalian GLI proteins, is alone essential and sufficient to induce FLC differentiation. My objective was to address three main questions concerning the role of Hh signaling in gonadal development. In "chapter III," I addressed the "first question" on whether Hh signaling is sufficient to induce FLC differentiation. Indeed, Hh activation led to appearance of ectopic functional FLCs in the ovary. In "chapter IV," I addressed the "second question" on the essential role of GLI and GLI2, as Hh transcriptional activators, to induce FLC development. My data showed that both GLI1 and GLI2 were modulators of Hh to establish FLCs. In "chapter V," I addressed the "third question" on the possible role of GLI3 (as a transcriptional repressor) to silence the Hh pathway in the fetal ovary, which expresses other mammalian Hh genes, such as "Shh." The repressor form of GLI3 was expressed in the fetal ovary, and null mutation of "Gli3" led to Hh activation and steroidogenic cell appearance. In "chapter VI," I used the Hh signaling over-activation as a tool to identify the progenitors of FLCs in the mouse fetal testis. In the "appendix," I provided speculations and ways to further investigate the questions that have been raised though the course my research. [The dissertation citations contained here are published with the permission of ProQuest LLC. Further reproduction is prohibited without permission. Copies of dissertations may be obtained by Telephone (800) 1-800-521-0600. Web page: http://www.proquest.com/en-US/products/dissertations/individuals.shtml.]