Basal cell carcinoma (BCC) is the most common type of skin cancer, with rising incidence rates primarily attributed to an aging population and ultraviolet radiation exposure. While the majority of BCCs are localized and respond to standard therapies, a very small minority of these tumors become locally destructive or metastasize. These advanced BCCs may not be amenable to localized treatment with surgery and/or radiation therapy. Most BCCs result from mutations in key receptors in the Hedgehog (HH) signaling pathway. As a result, identification of drugs that inhibit the receptor Smoothened (SMO) in the HH pathway has resulted in novel therapeutic approaches to treating patients with advanced BCC. These HH-pathway inhibiting medications have shown efficacy in clinical trials, and two medications, vismodegib and sonidegib, have received FDA approval. However, several limitations of these drugs have been identified, including treatment-limiting adverse events, drug resistance, and the formation of additional malignancies. This paper aims to summarize the clinical trials leading to the approval of SMO inhibitors, as well as reviewing potential mechanisms driving tumor resistance and the formation of cutaneous squamous cell carcinomas. Strategies to overcome some of these challenges, including the development of drugs that inhibit other downstream targets in the HH pathway, are the subject of ongoing clinical trials.