The sterol-sensing domain of Patched protein seems to control Smoothened activity through Patched vesicular trafficking.

The Hedgehog (Hh) family of signaling molecules function as organizers in many morphogenetic processes. Hh signaling requires cholesterol in both signal-generating and -receiving cells, and it requires the tumor suppressor Patched (Ptc) in receiving cells in which it plays a negative role. Ptc both blocks the Hh pathway and limits the spread of Hh. Sequence analysis suggests that it has 12 transmembrane segments, 5 of which are homologous to a conserved region that has been identified in several proteins involved in cholesterol homeostasis and has been designated the sterol-sensing domain (SSD). In the present study, we show that a Ptc mutant with a single amino acid substitution in the SSD induces target gene activation in a ligand-independent manner. This mutant Ptc(SSD) protein shows dominant-negative activity in blocking Hh signaling by preventing the downregulation of Smoothened (Smo), a positive effector of the Hh pathway. Despite its dominant-negative activity, the mutant Ptc protein functioned like the wild-type protein in sequestering and internalizing Hh. In addition, we show that Ptc(SSD) preferentially accumulates in endosomes of the endocytic compartment. All these results suggest a role of the SSD of Ptc in mediating the vesicular trafficking of Ptc to regulate Smo activity.