Sonic hedgehog (Shh) signals via Gli transcription factors to direct digit number and identity in the vertebrate limb. We characterized the Gli-dependent cis-regulatory network through a combination of whole-genome chromatin immunoprecipitation (ChIP)-on-chip and transcriptional profiling of the developing mouse limb. These analyses identified ∼5000 high-quality Gli3-binding sites, including all known Gli-dependent enhancers. Discrete binding regions exhibit a higher-order clustering, highlighting the complexity of cis-regulatory interactions. Further, Gli3 binds inertly to previously identified neural-specific Gli enhancers, demonstrating the accessibility of their cis-regulatory elements. Intersection of DNA binding data with gene expression profiles predicted 205 putative limb target genes. A subset of putative cis-regulatory regions were analyzed in transgenic embryos, establishing Blimp1 as a direct Gli target and identifying Gli activator signaling in a direct, long-range regulation of the BMP antagonist Gremlin. In contrast, a long-range silencer cassette downstream from Hand2 likely mediates Gli3 repression in the anterior limb. These studies provide the first comprehensive characterization of the transcriptional output of a Shh-patterning process in the mammalian embryo and a framework for elaborating regulatory networks in the developing limb.[Keywords: Sonic hedgehog; limb; morphogen; gli; cis-regulatory network] Supplemental material is available at http://www.genesdev.org. The vertebrate limb is one of the best studied models of how morphogen signaling elaborates a complex pattern (for review, see McGlinn and Tabin 2006). Shh secreted by a discrete posterior organizing center, the zone of polarizing activity (ZPA), is thought to act as a long-range, concentration-dependent signal that regulates both the number and identity of digits that arise from the distal mesenchyme of the developing limb bud. Both the concentration and time of Shh signaling are critical, and growth couples with morphogen activity to give the final digit pattern (Yang et al. 1997;Harfe et al. 2004;Towers et al. 2008;Zhu et al. 2008). Shh actions are mediated through the Gli transcriptional effector family (Gli1-3). Of these, Gli3 appears to play a crucial role in regulating digit number; loss of Gli3 repressor leads to polydactyly and suppresses the loss of digits (2-5) observed in Shh mutants (Litingtung et al. 2002;te Welscher et al. 2002b). Interactions between the limb mesenchyme and the apical ectodermal ridge (AER) are critical for digit development.The Shh pathway is thought to maintain the limb outgrowth-promoting role of AER produced FGFs through the regulation of a BMP antagonist, Gremlin (Zuniga et al. 1999;Khokha et al. 2003). In turn, AER signaling is essential for maintaining Shh expression (Laufer et al. 1994;Niswander et al. 1994). Genetic analyses have suggested that Shh-mediated loss of Gli3 repressor activity underlies the Shh → Gremlin → AER circuit, but whether this is a direct action of Gli repressor has no...