IFT80, a protein component of intraflagellar transport (IFT) complex B, is required for the formation, maintenance and functionality of cilia. Mutations in IFT80 cause Jeune asphyxiating thoracic dystrophy (JATD) and short rib polydactyly (SRP) type III. Both diseases are autosomal recessive chondrodysplasias and share clinical and radiological similarities, including shortening of the long bones and constriction of the thoracic cage. A murine Ift80 gene-trap line was used to investigate the role of Ift80 during development. The homozygote appears hypomorphic rather than a true null due to low level wild-type transcript production by alternative splicing around the gene-trap cassette. Hypomorphic levels of Ift80 result in embryonic lethality highlighting a key role for Ift80 in development. In rare cases, gene-trap homozygotes survive to postnatal stages and phenocopy both JATD and SRP type III by exhibiting growth retardation, shortening of the long bones, constriction of the ribcage and polydactyly. Mouse embryonic fibroblasts made from this line showed a significant reduction in hedgehog pathway activation in response to Hedgehog analog treatment. This defective signalling was not accompanied by the loss or malformation of cilia as seen in some knockout models of other IFT component genes. Phenotypes indicative of defects in cilia structure or function such as situs inversus, cystic renal disease and retinal degeneration were not observed in this line. These data suggest that there is an absolute requirement for Ift80 in hedgehog signalling, but low level expression permits ciliogenesis indicating separate but linked roles for this protein in formation and function.