The cortisol-inactivating enzyme 11β-hydroxysteroid dehydrogenase type 2 (11β-HSD2) that catalyzes the intracellular inactivation of glucocorticoids plays a pivotal role in human pregnant maintenance and normal fetal development. Given the fact that the main components of Hedgehog (HH) signaling pathway are predominantly expressed in syncytial layer of human placental villi where 11β-HSD2 is robustly expressed, in the present study, we have investigated the potential roles and underlying mechanisms of HH signaling in 11β-HSD2 expression. Activation of HH signaling by a variety of approaches robustly induced 11β-HSD2 expression as well as the 11β-HSD2 activity, whereas suppression of HH signaling significantly attenuated 11β-HSD2 expression as well as the 11β-HSD2 activity in both human primary cytotrophoblasts and trophoblast-like BeWo cells. Moreover, among glioma-associated oncogene (GLI) family transcriptional factors in HH signaling, knockdown of GLI2 but not GLI1 and GLI3 significantly attenuated HH-induced 11β-HSD2 expression and activity, and overexpression of GLI2 activator alone was sufficient to induce 11β-HSD2 expression and activity. Finally, GLI2 not only directly bound to the promoter region of gene hsd11b2 to transactivate hsd11b2 but also formed a heterodimer with RNA polymerase II, an enzyme that catalyzes the transcription of DNA to synthesize mRNAs, resulting in up-regulation of hsd11b2 gene transcription. Taken together, the present study has uncovered a hitherto uncharacterized role of HH/GLI2 signaling in 11β-HSD2 regulation, implicating that HH signaling through GLI2 could be required for the human pregnant maintenance and fetal development.