A thorough analysis of the mechanism of inhibition of human leukocyte elastase (HLE) by a monocyclic beta-lactam and the mechanism of beta-lactam hydrolysis led to the preparation of potent and highly stable inhibitors of HLE. This work led to the identification of 4-[(4-carboxyphenyl)-oxy]-3,3-diethyl-1- [[(phenylmethyl)amino]carbonyl]-2-azetidinone (2) as the first orally active inhibitor of human leukocyte elastase (HLE). Analogs of 2 with different substituents on the urea N were synthesized and evaluated for their activity in vitro against HLE as well as in vivo in a hamster lung hemorrhage model. Compounds with a methyl or a methoxy group in the para position of the benzene ring were very potent in both assays. The results are discussed on the basis of the proposed model for the binding of this class of inhibitors to HLE and a possible mechanism of inhibition is presented.