We construct superconformal gauged sigma models with extended rigid supersymmetry in three dimensions. Those with N>4 have necessarily flat targets, but the models with N⩽4 admit non-flat targets, which are cones with appropriate Sasakian base manifolds. Superconformal symmetry also requires that the three-dimensional spacetimes admit conformal Killing spinors which we examine in detail. We present explicit results for the gauged superconformal theories for N=1,2. In particular, we gauge a suitable subgroup of the isometry group of the cone in a superconformal way. We finally show how these sigma models can be obtained from Poincaré supergravity. This connection is shown to necessarily involve a subset of the auxiliary fields of supergravity for N⩾2.