The C-terminal part of the desert hedgehog protein precursor displays an autoproteolysis and a cholesterol transferase activity (By similarity). Both activities result in the cleavage of the full-length protein into two parts (N-product and C-product) followed by the covalent attachment of a cholesterol moiety to the C-terminal of the newly generated N-product (By similarity). Both activities occur in the reticulum endoplasmic (By similarity). Functions in cell-cell mediated juxtacrine signaling (PubMed:24342078). Promotes endothelium integrity (PubMed:33063110). Binds to PTCH1 receptor, which functions in association with smoothened (SMO), to activate the transcription of target genes in endothelial cells (PubMed:33063110). In Schwann cells, controls the development of the peripheral nerve sheath and the transition of mesenchymal cells to form the epithelium-like structure of the perineurial tube (By similarity). The dually lipidated desert hedgehog protein N-product is essential for a variety of patterning events during development (By similarity). Binds to the patched (PTCH1) receptor, which functions in association with smoothened (SMO), to activate the transcription of target genes (PubMed:11472839, PubMed:33063110). Required for normal testis development and spermatogenesis, namely for the formation of adult-type Leydig cells and normal development of peritubular cells and seminiferous tubules (By similarity). Activates primary cilia signaling on neighboring valve interstitial cells through a paracrine mechanism (By similarity). May induce motor neurons in lateral neural tube and may have a polarizing activity (PubMed:11472839). Prevents the desert hedgehog protein precursor binding to PTCH1 (PubMed:33063110). cholesterol + glycyl-L-cysteinyl-[protein] + H(+) = [protein]-C-terminal glycyl cholesterol ester + N-terminal L-cysteinyl-[protein] Multimer. Interacts with BOC and CDON (PubMed:20519495). Interacts with HHIP (PubMed:19561611). Co-localizes with HHAT in the ER and Golgi membrane. Binds calcium and zinc ions; this stabilizes the protein fold and is essential for protein-protein interactions mediated by this domain. The C-terminal domain regulates the auto-processing and controls the juxtacrine signaling. Partially autoproteolyzed (PubMed:30298535, PubMed:24342078). The C-terminal domain displays an autoproteolysis activity and a cholesterol transferase activity (By similarity). Both activities result in the cleavage of the full-length protein and covalent attachment of a cholesterol moiety to the C-terminal of the newly generated N-terminal fragment (DhhN) (By similarity). N-palmitoylation by HHAT of DhhN is required for desert hedgehog protein N-product multimerization and full activity (By similarity). The disease may be caused by variants affecting the gene represented in this entry. The disease may be caused by variants affecting the gene represented in this entry. Belongs to the hedgehog family.