In amniotes, inhibition of hedgehog (Hh) signalling in the early embryonic endoderm is a prerequisite for pancreatic specification. By contrast, loss of Hh signalling in zebrafish severely disrupts pancreas development, suggesting opposite roles for Hh signalling in fish versus mammalian pancreas organogenesis. Zahra Tehrani and Shuo Lin (p. 631) now reconcile these contrasting functions by showing that the Hh pathway plays distinct roles during various stages of zebrafish pancreas development. Using genetic and pharmacological approaches to temporally modulate Hh activity, they show that Hh activity during early gastrulation is essential for the subsequent migration and differentiation of pancreatic precursors. This positive role of Hh acts to restrict Bmp signalling and to promote β-cell differentiation. By the end of gastrulation, they report, Hh signalling adopts a negative role by antagonizing retinoic acid (RA)-mediated induction of endocrine pancreatic precursors. These findings highlight sequential roles for Hh signalling in pancreas development and uncover antagonistic relationships between the Hh, Bmp and RA pathways during pancreas organogenesis.