Tumor metastasis are accompanied by the EMT (epithelial-mesenchymal transition)-MET (mesenchymal-epithelial transition) two-step process. In this study, we investigated the importance of cancer associated fibroblasts (CAF) in the process. First, the primary cultures of isolated pancreatic CAF, fibroblasts of normal pancreatic tissues (NF), and normal hepatic stellate cells (HSF) were identified and verified via the expression of α-SMA and vimentin. Using an indirect three-dimensional co-culture model, the morphological changes were observed by light microscopy and laser scanning confocal microscopy. The invasive and migration capacity of pancreatic cancer cells was determined by Transwell chamber migration assay or scratch assay. The mRNA and protein expression levels of E-cadherin, vimentin, and Gli1 were determined by RT-PCR and western blotting. Primary cultures of isolated CAF, NF, HSF showed satisfactory growth with active proliferation. Indirect co-culture with CAF, BxPc-3 and Panc-1 cells showed significant partial EMT, reduced E-cadherin expression, and enhanced vimentin expression as compared with the single culture and NF/HSF co-culture groups, with corresponding increases in migratory and invasive capacities. PCR and western blotting results showed that mRNA and protein expression levels of Gli1 in CAF and Snail in cancer cells were increased. This process could be reversed by inhibition of hedgehog (HH) signaling in CAF. In the tumor microenvironment, activation of CAF is the key event in mediating partial EMT, and its mechanism may be associated with paracrine action after activation of HH signaling in CAF.