Hedgehog (Hh) proteins are responsible for critical signalling events during development but their evolutionary roles remain to be determined. Here we show that hh gene expression at the embryonic midline controls eye degeneration in blind cavefish. We use the teleost Astyanax mexicanus, a single species with an eyed surface-dwelling form (surface fish) and many blind cave forms (cavefish), to study the evolution of eye degeneration. Small eye primordia are formed during cavefish embryogenesis, which later arrest in development, degenerate and sink into the orbits. Eye degeneration is caused by apoptosis of the embryonic lens, and transplanting a surface fish embryonic lens into a cavefish optic cup can restore a complete eye. Here we show that sonic hedgehog (shh) and tiggy-winkle hedgehog (twhh) gene expression is expanded along the anterior embryonic midline in several different cavefish populations. The expansion of hh signalling results in hyperactivation of downstream genes, lens apoptosis and arrested eye growth and development. These features can be mimicked in surface fish by twhh and/or shh overexpression, supporting the role of hh signalling in the evolution of cavefish eye regression.