Stem cell model for sebaceous tumour development. Cutaneous multipotent stem cells can develop into follicular, interfollicular epidermal or sebaceous structures under a variety of signals (right side). Intense signalling through the Wnt pathway resulting in increased β-catenin and Lef-1 activation leads to a follicular fate, while less intense signalling allows a sebaceous fate and absence of signalling to an interfollicular epidermal fate. Regarding tumourigenesis (left side), activating mutations in β-catenin, presumably acting with Lef-1, leads to hair follicle tumours such as pilomatrixomas. Abrogation of the Lef-1 pathway, likely in combination with other events, leads to sebaceous tumourigenesis and perhaps keratoacanthoma-like lesions as well. The role of stem cells in this process is not well characterized, but this is an attractive model since stem cells persist for the life of the organisms and thus can more readily be the target of the multiple mutations likely required for tumourigenesis. SHH, sonic hedgehog; IHH, indian hedgehog; PTCH, patched.