Here, we use Prrx1-CreERT; Ptch1f/f mice to study the functions of Hh signaling in mesenchymal stem/stromal cells (MSCs) during adolescence and show that activation of Hh signaling promotes MSC proliferation and osteogenic and chondrogenic differentiation but suppresses MSC adipogenic differentiation and leads to development of osteoarthritis-like phenotypes, enchondroma, and osteosarcoma. The gene discussed is PRRX1; the disease is osteosarcoma.