In our study, published Nov 02 in Nature Cell Biology (Lim, Shin, Beachy NCB 2014), we found that Hh response in regenerating prostate is present in the stromal cells that enwrap prostate tubules, but is conspicuously absent from stromal cells at the sites of nascent tubule buds. These stromal cells lacking Hh response express higher levels of Hgf than Hh-responsive stromal cells, an effect probably mediated by Hh induction of miR-26a and miR-26b. We found that Hgf stimulates prostate branching, thus providing a link between reduced Hh response in specific regions of the stroma and the sites of epithelial branching. Finally, we found that the spatial pattern of Hh signal response in stromal cells is strikingly similar to the pattern of Ihh expression in the epithelium, suggesting that the location of nascent buds during adult prostate branching morphogenesis is specified by spatially restricted Hh signalling from epithelium to stroma. Our data suggest a model in which regional differences in Hh ligand secretion and pathway response determine the location of a nascent bud during adult branching morphogenesis. Thus, in epithelial regions of high Ihh expression, Hh response in adjacent stromal cells downregulates stromal expression of Hgf by inducing expression of miR-26a and miR-26b, leading to low concentrations of Hgf ligand and a consequent lack of branching. Regions of low epithelial Ihh ligand expression in contrast would be associated with low Hh response in adjacent stromal cells, permitting high levels of Hgf secretion that could stimulate formation of nascent buds.