Post-translational modifications of the developmental signaling protein Son
ic hedgehog (Shh) by a long-chain fatty acid at the N-terminus and choleste
rol at the C-terminus greatly activate the protein in a cell-based signalin
g assay. To investigate the structural determinants of this activation phen
omenon, hydrophobic and hydrophilic moieties have been introduced by chemic
al and mutagenic methods to the soluble N-terminal signaling domain of Shh
and tested in both in vitro and in vivo assays. A wide variety of hydrophob
ic modifications increased the potency of Shh when added at the N-terminus
of the protein, ranging from long-chain fatty acids to hydrophobic amino ac
ids, with EC50 values from 99 nM for the unmodified protein to 0.6 nM for t
he myristoylated form. The N-myristoylated Shh was as active as the natural
form having both N- and C-terminal modifications. The degree of activation
appears to correlate with the hydrophobicity of the modification rather th
an any specific chemical feature of the adduct; moreover, substitution with
hydrophilic moieties decreased activity. Hydrophobic modifications at the
C-terminus of Shh resulted in only a 2-3-fold increase in activity, and no
activation was found with hydrophobic modification at other surface positio
ns. The N-terminal modifications did not appear to alter the binding affini
ty of the Shh protein for the transfected receptor protein, Patched, and ha
d no apparent effect on structure as measured by circular dichroism, therma
l denaturation, and size determination. Activation of Desert Hh through mod
ification of its N-terminus was also observed, suggesting that this is a co
mmon feature of Hh proteins.