Targeting the hedgehog (HH) pathway to treat aggressive cancers of the brain, breast, pancreas, and prostate has been ongoing for decades. Gli gene amplifications have been long discovered within malignant glioma patients, and since then, inhibitors against HH pathway-associated molecules have successfully reached the clinical stage where several of them have been approved by the FDA. Albeit this success rate implies suitable progress, clinically used HH pathway inhibitors fail to treat patients with metastatic or recurrent disease. This is mainly due to heterogeneous tumor cells that have acquired resistance to the inhibitors along with the obstacle of effectively targeting the tumor microenvironment (TME). Severe side effects such as hyponatremia, diarrhea, fatigue, amenorrhea, nausea, hair loss, abnormal taste, and weight loss have also been reported. Furthermore, HH signaling is known to be involved in the regulation of immune cell maturation, angiogenesis, inflammation, and polarization of macrophages and myeloid-derived suppressor cells. It is critical to determine key mechanisms that can be targeted at different levels of tumor development and progression to address various clinical issues. Hence current research focus encompasses understanding how HH controls TME to develop TME altering and combinatorial targeting strategies. In this review, we aim to discuss the pros and cons of targeting HH signaling molecules, understand the mechanism involved in treatment resistance, reveal the role of the HH pathway in anti-tumor immune response, and explore the development of potential combination treatment of immune checkpoint inhibitors with HH pathway inhibitors to target HH-driven cancers.