Sonic hedgehog (Shh) is a component of the Hedgehog signaling pathway, playing an important role in regulating cell proliferation, differentiation, apoptosis, and the repair of damaged organisms. To further clarify the expression pattern of Shh gene in the secondary hair follicle growth cycle of cashmere goats and its mechanism of action on secondary hair follicle papilla cells, and improve cashmere quality, in this study, we took Inner Mongolia Albas white cashmere goats as the research objects and collected skin samples at different growth stages to obtain secondary hair follicles, detected Shh and its gene expression by RT-qPCR, Western blot, immunohistochemistry, and other techniques, while we also cultured DPCs in vitro. Shh gene overexpression and interference vectors were constructed, and the effects of Shh gene on the proliferation and apoptosis of DPCs were studied through cell transfection technology. The results showed that there are significant differences in Shh and its gene expression in the secondary hair follicle growth cycle skins of cashmere goats, with the highest expression level in anagen, followed by catagen, and the lowest expression level in telogen. Shh was mainly expressed in the inner root sheath, outer root sheath, and secondary hair follicle papilla. After the overexpression of Shh gene, the proliferation and vitality of the hair papilla cells were enhanced compared to the interference group. After Shh gene interference, the apoptosis rate of the cells increased, indicating that Shh gene can regulate downstream Ptch, Smo, and Gli2 gene expression to promote the proliferation of DPCs, and thus form its expression pattern in the secondary hair follicle growth cycle of cashmere goats.