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Signaling through vertebrate Hedgehog (Hh) proteins depends on the primary cilium. In response to Hh signals, the transcriptional activator of the pathway, Gli2, accumulates at the ciliary tip, raising the possibility that ciliary localization is important for Gli2 activation. To test this hypothesis, we used the Floxin system to create knock-in Gli2 alleles in embryonic stem cells (ESCs) to allow methodical testing of which domains and residues are essential for the ciliary localization of Gli2. The Gli2 zinc fingers, transcriptional activation domain, repressor domain, phosphorylation cluster and a Sufu binding motif were each dispensable for ciliary localization. Mutating residues that are required for Gli2 sumoylation and nuclear trafficking also did not abrogate ciliary localization. By contrast, several other domains restricted Gli2 nuclear localization, and a central region, distinct from previously characterized domains, was required for ciliary localization. In addition to an inability to localize to cilia, Gli2 lacking this central domain was unable to activate target genes. Thus, our systematic analysis in ESCs reveals that distinct regions of Gli2 regulate its nuclear and ciliary localization. The identification of a domain essential for both ciliary localization and transcriptional activity suggests that ciliary localization of Gli2 is required for its activation.

A central region of Gli2 regulates its localization to the primary cilium and transcriptional activity