SHH subgroup medulloblastoma (SHH-MB) is one of the most common malignant pediatric tumors that arises in the cerebellum. Previously, we showed that RNA m<sup>6</sup>A methylation participates in regulation of cerebellar development. Here we investigate whether dysregulated m<sup>6</sup>A methylation contributes to tumorigenesis of SHH-MB. We show that high expression of m<sup>6</sup>A methyltransferase METTL3 associates with worse survival in the patients with SHH-MB. A large number of hypermethylated transcripts are identified in SHH-MB tumor cells by m<sup>6</sup>A-seq. We find that METTL3 promotes tumor progression via activating Sonic hedgehog signaling. Mechanistically, METTL3 methylates PTCH1 and GLI2 RNAs and further regulates their RNA stability and translation. Importantly, targeting METTL3 by depleting METTL3 expression or treatment with its catalytic inhibitor STM2457 restrains tumor progression. Collectively, this study shows a critical function for METTL3 and m<sup>6</sup>A methylation in SHH-MB, indicative of a potential role of METTL3 as therapeutic target in SHH-MB.