Smoothened (Smo) is usually classified with family B GPCRs based on homology. There are indications that it can signal via G-proteins Gi and G12/13 (Ruiz-Gomez, 2007) but this role is poorly understood. It's better characterised physiological role is as the transducer of hedgehog (HH) signaling. In this capacity Smo is not acting as a receptor, but as part of a signaling cascade.

The Hedgehog(HH)/Smo signalling pathway was identified as a key component of Drosophila development and subsequently found to be conserved in all meatazoans. Most of the functions attributed to Smo are associated with development such as digit patterning in the chick limb bud and left–right asymmetry of vertebrate embryos. In addition, Smo appears to be involved in homeostasis; deregulated Smo signaling is implicated in tumorogenesis (Ruiz-Gomez, 2007).

The ligand of the 12 transmembrane-domain receptor Patched (Ptc) is Hedgehog(HH) but in the absence of HH, Ptc binds Smo (Stone et al. 1996) which consequently becomes internalised into endosomes, where it associates with Costal-2 (Cos2), and lysosomes, where it is degraded. This 'inactivates' Smo by preventing the formation of an active Smo signaling complex at the plasma membrane. Internalised Smo:Cos2 forms a complex with protein kinase A (PKA), casein kinase I (CKI) glycogen synthase kinase-3 (GSK3) and Cucurbitus interruptus (Ci), a transcriptional regulator, enabling phosphorylation of Ci and subsequent processing to a transcriptional repressor form (CiR). When HH binds to Ptc, it does not bind Smo, allowing Smo to undergo a conformational change, exposing a new surface in its cytoplasmic tail. This causes PKA, CKI and GSK3 to dissociate from Smo:Cos2 complexes, so that Ci is no longer phosphorylated or processed to CiR. Accumulating Smo is phosphorylated instead and assumes a third conformational state. Phosphorylated Smo trafficks to the plasma membrane (Denef et al. 2000) and assembles into a signalling complex that promotes the phosphorylation of Fused (Fu) and Cos2. Phosphorylated Cos2 dissociates from membranes and recruits Fu to Sufu (Suppressor of Fused), which produces the activated form of Ci (CiA), probably through phosphorylation of Sufu (Hooper & Scott, 2005).