While the kinesin-2 motors KIF3A and KIF3B have essential roles in ciliogenesis and Hedgehog (HH) signal transduction, potential role(s) for another kinesin-2 motor, KIF17, in HH signaling have yet to be explored. Here, we investigated the contribution of KIF17 to HH-dependent cerebellar development, where Kif17 is expressed in both HH-producing Purkinje cells and HH-responding cerebellar granule neuron progenitors (CGNPs). Germline Kif17 deletion in mice results in cerebellar hypoplasia due to reduced CGNP proliferation, a consequence of decreased HH pathway activity mediated through decreased Sonic HH (SHH) protein. Notably, Purkinje cell-specific Kif17 deletion partially phenocopies Kif17 germline mutants. Unexpectedly, CGNP-specific Kif17 deletion results in the opposite phenotype-increased CGNP proliferation and HH target gene expression due to altered GLI transcription factor processing. Together, these data identify KIF17 as a key regulator of HH-dependent cerebellar development, with dual and opposing roles in HH-producing Purkinje cells and HH-responding CGNPs.