Metastases account for the majority of mortalities related to breast cancer. The onset and sustained presence of hypoxia strongly correlates with increased incidence of metastasis and unfavorable prognosis in patients with breast cancer. The Hedgehog (Hh) signaling pathway is dysregulated in breast cancer, and its abnormal activity enables tumor progression and metastasis. In addition to programming tumor cell behavior, Hh activity enables tumor cells to craft a metastasis-conducive microenvironment. Hypoxia is a prominent feature of growing tumors that impacts multiple signaling circuits that converge upon malignant progression. We investigated the role of Hh activity in crafting a hypoxic environment of breast cancer. We used radioactive tracer [18F]-fluoromisonidazole (FMISO) positron emission tomography (PET) to image tumor hypoxia. We show that tumors competent for Hh activity are able to establish a hypoxic milieu; pharmacologic inhibition of Hh signaling in a syngeneic mammary tumor model mitigates tumor hypoxia. Furthermore, in hypoxia, Hh activity is robustly activated in tumor cells and institutes increased HIF signaling in a VHL-dependent manner. The findings establish a novel perspective on Hh activity in crafting a hypoxic tumor landscape and molecularly navigating the tumor cells to adapt to hypoxic conditions.