Indandiones were identified as a novel class of small molecule inhibitors of hepatitis C virus NS3 serine protease from high throughput screening. We further studied the structure activity relationships and the mechanisms of inhibition for this class of compounds. Our studies revealed two similar, yet different, mechanisms accounting for the apparent indandione inhibition of HCV NS3 protease. In one case, the apparent inhibition results from the chemical breakdown of the parent compound and the subsequent redox chemistry of the compound. Oxidation of the cysteine containing substrate A to a disulfide-linked dimer converts this substrate to a potent, slow-binding inhibitor with a K(i) value of 170 nM. The second class of indandiones appears to react directly with the substrate to form an S-phenyl disulfide adduct with the P1 cysteine. This modification converts the substrate to a slow-binding inhibitor with a K(i) value of 110 nM, a k(on) = 2370 M(-1) s(-1), and k(off) = 2.5 x 10(-4) s(-1). A stable analogue of this latter compound was synthesized that contained a CH(2)-S linkage instead of the S-S linkage. The CH(2)-S compound showed no inhibition at concentrations as high as 40 microM, which suggests an important role for the S-S linkage in the inhibitory mechanism. Cysteine 159, which lies near the active site of the HCV protease, was mutated to serine. The C159S mutant displayed wild-type catalytic activity and susceptibility to inhibition by the S-S linked inhibitor. This result argues against a mechanism involving disulfide exchange between the inhibitor and the sulfhydryl group of C159. The mechanism of inhibition for this S-S linked substrate based inhibitor is likely due to oxidation of cysteines involved in chelation of the structural zinc atom.