The Dicer1, Dcr-1 homolog (Drosophila) gene encodes a type III ribonuclease required for the canonical maturation and functioning of microRNAs (miRNAs). Subsets of miRNAs are known to regulate normal cerebellar granule cell development, in addition to the growth and progression of medulloblastoma, a neoplasm that often originates from granule cell precursors. Multiple independent studies have also demonstrated that deregulation of Sonic Hedgehog (Shh)-Patched (Ptch) signaling, through miRNAs, is causative of granule cell pathologies. In the present study, we investigated the genetic interplay between miRNA biogenesis and Shh-Ptch signaling in granule cells of the cerebellum by way of the Cre/lox recombination system in genetically engineered models of Mus musculus (mouse). We demonstrate that, although the miRNA biogenesis and Shh-Ptch-signaling pathways, respectively, regulate the opposing growth processes of cerebellar hypoplasia and hyperplasia leading to medulloblastoma, their concurrent deregulation was nonadditive and did not bring the growth phenotypes toward an expected equilibrium. Instead, mice developed either hypoplasia or medulloblastoma, but of a greater severity. Furthermore, some genotypes were bistable, whereby subsets of mice developed hypoplasia or medulloblastoma. This implies that miRNAs and Shh-Ptch signaling regulate an important developmental transition in granule cells of the cerebellum. We also conclusively show that the Dicer1 gene encodes a haploinsufficient tumor suppressor gene for Ptch1-induced medulloblastoma, with the monoallielic loss of Dicer1 more severe than biallelic loss. These findings exemplify how genetic interplay between pathways may produce nonadditive effects with a substantial and unpredictable impact on biology. Furthermore, these findings suggest that the functional dosage of Dicer1 may nonadditively influence a wide range of Shh-Ptch-dependent pathologies.