The stem cell paradigm was first demonstrated in hematopoietic stem cells. Whilst classically it was cytokines and chemokines which were believed to control stem cell fate, more recently it has become apparent that the stem cell niche and highly conserved embryonic pathways play a key role in governing stem cell behavior. One of these pathways, the hedgehog signaling pathway, found in all organisms, is vitally important in embryogenesis, performing the function of patterning through early stages of development, and in adulthood, through the control of somatic stem cell numbers. In addition to these roles in health however, it has been found to be deregulated in a number of solid and hematological malignancies, components of the hedgehog pathway being associated with a poor prognosis. Further, these components represent viable therapeutic targets, with inhibition from a drug development perspective being readily achieved, making the hedgehog pathway an attractive potential therapeutic target. However, although the concept of cancer stem cells is well established, how these cells arise and the factors which influence their behavior are not yet fully understood. The role of the hedgehog signaling pathway and its potential as a therapeutic target in hematological malignancies is the focus of this review.