Fins in fishes are appendages that serve to facilitate maneuvering in water. Compared to their ancestral state, teleosts have reduced radial bones in their paired fin skeletons and have acquired elaborated, agile paired fins. We found that mutation of Hedgehog interacting protein (Hhip), encoding an antagonist of Hedgehog signaling, leads to an increase of radial bones in a localized region and replicates the ancestral state. Interestingly, the caudal fin, which has undergone a reduction of skeleton structure in teleosts, as well as the paired fins, exhibit a regional-specific branching of the 2nd hypural in hhip-/- mutant zebrafish. These results imply that Hedgehog signaling is repressed during fin development in teleosts compared to the ancestral state. Molecular genetic analyses show that shhb, one of the Sonic hedgehog (Shh) genes, encoding one of the Hedgehog ligands in teleosts, is expressed during subdivision of endochondral components in paired fin skeletal development, and that mutation of shhb leads to hypoplasia of the paired fin skeletons. Therefore, we suggest that paired and caudal fins in fishes possess a specific region susceptible to Hedgehog signaling. The reduction of radial bones by repressive regulation of Hedgehog signaling may induce fin elaboration in teleosts.