Abstract The hedgehog signalling inhibitor cyclopamine has been shown to induce growth inhibition and cell cycle arrest in prostate cancer cell lines, but the mechanism of action has not been clearly defined, and observations between laboratories have not always been consistent. We first observed that albumin can protect PC-3 prostate cancer cells from cyclopamine-induced growth inhibition, suggesting that cyclopamine binds to albumin, and that only free cyclopamine is active. We then conducted a phospho-site protein kinase screen to elucidate the mechanism of cyclopamine-induced growth inhibition. Treatment of PC-3 cells with 5 or 10 μM cyclopamine for 72 h resulted in a decrease in cell viability of ∼50% and ∼75%, respectively. A phospho-site protein kinase screen showed that cyclopamine decreased levels of phospho-Thr 187-p27 by 71%. This phospho-site on p27 positively regulates its ubiquitin degradation; therefore a decrease in phospho-Thr 187-p27 should correlate with increased levels of p27. Consistent with this hypothesis, treatment of PC-3 cells with cyclopamine resulted in a ∼3-fold increase in p27 protein levels. Cdk-2 phosphorylates Thr 187-p27, and immunoblotting demonstrated that cyclopamine treatment of PC-3 cells reduces the expression of cdk-2. Furthermore, cyclopamine decreased the levels of phosphorylated (activated) Akt, which is known to increase p27 degradation via Skp-2-induced ubiquitination. The mechanism by which cyclopamine decreases phosphorylated Akt is currently under investigation, but it may involve our observed cyclopamine-induced reduction in IRS-1 and IGF-II expression. These results demonstrate novel molecular correlates of cyclopamine-induced growth inhibition of prostate cancer cells.