The link between basal cell carcinoma (BCC) and aberrant activation of the Hedgehog (Hh) signaling pathway has been well established in humans and in mouse models. Here we report the development of assays, including two novel in vitro BCC models, which allowed us to screen for Hh inhibitors and test their validity as potential treatments for BCC. We identified a novel small molecule Hh inhibitor (CUR61414) that can block elevated Hh signaling activity resulting from oncogenic mutations in Patched-1. Moreover, CUR61414 can suppress proliferation and induce apoptosis of basaloid nests in the BCC model systems, whereas having no effect on normal skin cells. These findings directly demonstrate that the use of Hh inhibitors could be a valid therapeutic approach for treating BCC