Hedgehog (Hh) signaling plays a critical role in embryogenesis and tissue homeostasis, and its deregulation has been associated with tumor growth. The tumor suppressor SuFu inhibits Hh signaling by preventing the nuclear translocation of Gli and suppressing cell proliferation. Regulation of SuFu activity and stability is key to controlling Hh signaling. Here, we unveil SuFu Negating Protein 1 (SNEP1) as a novel Hh target, that enhances the ubiquitination and proteasomal degradation of SuFu and thus promotes Hh signaling. We further show that the E3 ubiquitin ligase LNX1 plays a critical role in the SNEP1-mediated degradation of SuFu. Accordingly, SNEP1 promotes colorectal cancer (CRC) cell proliferation and tumor growth. High levels of SNEP1 are detected in CRC tissues and are well correlated with poor prognosis in CRC patients. Moreover, SNEP1 overexpression reduces sensitivity to anti-Hh inhibitor in CRC cells. Altogether, our findings demonstrate that SNEP1 acts as a novel feedback regulator of Hh signaling by destabilizing SuFu and promoting tumor growth and anti-Hh resistance.