Provided herein are nucleic acid constructs encoding Hh regulating proteins, which are proteins that activate or inhibit Hh signaling. Exemplary Hh regulating proteins are N- or C-terminally truncated forms of Gli proteins or a dominant negative form of PKA. The Hh regulating proteins may be linked to a heterologous protein, e.g., green fluorescent protein (GFP), and may further be under the control of an inducible promoter. These constructs may be used, e.g., for modulating Hh signaling, and therefore, e.g., cell proliferation and differentiation. Also provided herein are Hh reporter construct, comprising, e.g., a promoter or promoter element that is controlled by a Gli protein. Cells and organisms comprising the nucleic acids are also described, as well as the use of these in assays for identifying agents that can be used for treating or preventing Hh associated diseases, such as cancer. They may also be used in assays for determining the toxicity of an agent or a sample.