The organogenesis of the digestive tract proceeds according to the positional information along the cephalo-caudal, dorsal-ventral and left-right axes of the embryonic body and the radial axis of the tract during development. Among them the radial axis, which corresponds to the crypt-villus axis in the adult small intestine, is essential for a rapid cell renewal of the epithelium throughout adulthood and is important from the clinical viewpoint. All of the adult intestinal epithelial cells originate from multipotent stem cells localized in the basal region of the crypt. Descendants of the stem cells, as they migrate up or down along the crypt-villus axis, actively proliferate, differentiate and finally undergo apoptosis. Recently, there has been a growing body of evidence that the Wnt and Notch signaling pathways are involved in cell proliferation and cell fate determination, respectively, during the epithelial cell renewal. However, the molecular mechanisms by which the radial axis is established and/or is maintained to enable the epithelial cell renewal have not yet been fully understood, and their clarification is urgently needed for stem cell therapies. In the amphibian intestine during metamorphosis, stem cells analogous to the mammalian ones appear and newly form the epithelium that undergoes the cell renewal along the radial axis by the inductive action of thyroid hormone. Thus, this animal model provides us with a good opportunity to clarify the molecular mechanisms of radial axis formation. By using the Xenopus laevis intestine, we found that sonic hedgehog (Shh), which is secreted by the stem cells, induces bone morphogenetic protein-4 (BMP-4) in subepithelial fibroblasts and that both Shh and BMP-4 are involved in the development of the cell-renewable epithelium. In this review, we highlight the molecular aspects of the cell renewal of the adult intestinal epithelium and propose important roles of the Shh/BMP-4 signaling pathway in the establishment and/or maintenance of the radial axis common to the human intestine.