The Smoothened (Smo) signalling pathway participates in many developmental processes, contributing to the regulation of gene expression by controlling the activity of transcription factors belonging to the Gli family. The key elements of the pathway were identified by means of genetic screens carried out in Drosophila, and subsequent analysis in other model organisms revealed a high degree of conservation in both the proteins involved and in their molecular interactions. Recent analysis of the pathway, using a combination of biochemical and cell biological approaches, is uncovering the intricacies of Smo signalling, placing its elements in particular cellular compartments and qualifying the molecular processes involved. These include the synthesis, secretion and diffusion of the ligand, the activation of the receptor and the modifications in the activity of nuclear effectors. In this review we discuss recent advances in understanding biochemical and cellular aspects of Smo signalling, with particular focus in the similarities in the mechanism of signal transduction between Smo and other transmembrane proteins belonging to the G-Protein coupled receptors superfamily (GPCR).