Glucocorticoids (GCs) play a critical role in neural development; however, their prenatal or neonatal therapeutic use can have detrimental effects on the developing brain. In this issue of the JCI, Heine and Rowitch report that the molecular mechanisms underlying these detrimental effects involve the sonic hedgehog (Shh) signaling pathway, a crucial regulator of brain development and neural stem/progenitor cells (see the related study beginning on page 267). They show that GCs suppress Shh-induced proliferation of cerebellar progenitor cells in postnatal mice and that, conversely, Shh signaling is protective against GC-induced neonatal cerebellar injury by inducing the enzyme 11betaHSD2, which inactivates the GCs corticosterone and prednisolone, but not dexamethasone. The data provide a rationale for the therapeutic use of 11betaHSD2-sensitive GCs, but not dexamethasone, or for the exploitation of the neuroprotective effect of Shh agonists to prevent GC-induced pre- or neonatal brain injury.