The major purpose of this work is to investigate mechanisms governing brain development. Specifically, these studies focus on the signaling protein Shh, and novel proteins that regulate its activity. Many of the proteins in the Shh pathway have been shown to play an integral role in specific clinical disorders. Mutations in the Shh gene itself cause holoprosencephaly. The finding that Shh requires a C-terminal cholesterol moiety for signaling supports its involvement in limb, CNS, and facial malformations that result from genetic or environmentally-induced cholesterol deficiency. From the proposed work on the mechanism of Shh N-terminal fatty-acylation, it is likely that mutation(s) of genes affecting the regulation of this process will also result in diseases similar to loss-of-function Shh mutants. In addition to developmental defects, mutations in patched or gli (genes in the Shh pathway) result in tumor formation. Thus, investigation of the mechanisms influencing Shh signaling will increase our understanding of a multitude of disease states that result from the disruption of this pathway. A major goal of these studies is to determine how specific forebrain neurons are generated. While it is known that grafting of fetal tissue into humans suffering from neurodegenerative disorders such as Huntington's and Parkinson's disease can be therapeutic, the lack of availability of donor tissue often limits this method. Given that both Huntington's and Parkinson's disease result from the degeneration of specific neuronal populations, the proposed work may reveal factors important to the regeneration of such neurons. Lastly, lessons learned from the use of replication-defective viruses and ultrasound-guided embryonic injections, as proposed in these studies, can be applied to perfecting tools for gene therapy, specifically to define the relationship between the timing and dose of exogenous agents in rescuing a particular disease.