Hedgehog (Hh) signal molecules play a fundamental role in development, adult stem cell maintenance and cancer. Hh can signal at a distance, and we have proposed that its graded distribution across Drosophila epithelia is mediated by filopodia-like structures called cytonemes. Hh reception by Patched (Ptc) happens at discrete sites along presenting and receiving cytonemes, reminiscent of synaptic processes. Here, we show that a vesicle fusion mechanism mediated by SNARE proteins is required for Ptc placement at contact sites. Transport of Ptc to these sites requires multivesicular bodies (MVBs) formation via ESCRT machinery, in a manner different to that regulating Ptc/Hh lysosomal degradation after reception. These MVBs include extracellular vesicle (EV) markers and, accordingly, Ptc is detected in the purified exosomal fraction from cultured cells. Blockage of Ptc trafficking and fusion to basolateral membranes result in low levels of Ptc presentation for reception, causing an extended and flattened Hh gradient.