The Hedgehog (Hh) pathway is essential for embryonic development and tissue homeostasis. Aberrant Hh signaling may occur in a wide range of human cancers, such as medulloblastoma, the most common brain malignancy in childhood. Here, we identify endoplasmic reticulum aminopeptidase 1 (ERAP1), a key regulator of innate and adaptive antitumor immune responses, as a previously unknown player in the Hh signaling pathway. We demonstrate that ERAP1 binds the deubiquitylase enzyme USP47, displaces the USP47-associated βTrCP, the substrate-receptor subunit of the SCFβTrCP ubiquitin ligase, and promotes βTrCP degradation. These events result in the modulation of Gli transcription factors, the final effectors of the Hh pathway, and the enhancement of Hh activity. Remarkably, genetic or pharmacological inhibition of ERAP1 suppresses Hh-dependent tumor growth in vitro and in vivo. Our findings unveil an unexpected role for ERAP1 in cancer and indicate ERAP1 as a promising therapeutic target for Hh-driven tumors.