Hedgehog (Hh) signaling is a regulator of salivary gland morphogenesis, but its role in postnatal glands has only recently begun to be addressed. To examine the effects of deregulated Hh signaling in the salivary gland, we expressed the Hh effector protein GLI1, in salivary epithelial cells using both cytokeratin 5 and mouse mammary tumor virus (MMTV) transgenic systems. Ectopic pathway activation resulted in restrained acinar differentiation, formation of cystic lesions, and prominent appearance of ductal structures. Moreover, induced expression of GLI1 aids the formation of hyperplastic lesions, which closely resemble GLI1-induced changes in murine skin and mammary glands, suggesting that GLI1 targets cells with similar characteristics in different tissues. Furthermore, GLI1-expressing salivary epithelial cells are actively dividing, and GLI1-induced lesions are proliferative, an incident accompanied by enhanced expression of the Hh target genes, cyclin D1, and Snail. GLI1-induced salivary lesions regress after transgene withdrawal and become histologically normalized. Taken together, our data reveal the ability of GLI1 to modulate salivary acinar differentiation and to promote proliferation of ductal epithelial cells.