Human leukocyte elastase (HLE) is a serine protease which has been implicated as a causative agent in several pulmonary diseases. The continued modification of our previously reported cephalosporin-based HLE inhibitors has led to the identification of a series of C-2 amides with potent, topical activity in an in vivo hamster lung hemorrhage model. While the most potent in vitro HLE inhibition had previously been obtained with lipophilic ester derivatives, it was found that the less active, but more polar and stable, amide derivatives were much more effective in vivo. The development of the structure--activity relations for optimization of these activities is discussed. These results led to the selection of 3-(acetoxymethyl)-2-[(2(S)-carboxypyrrolidino)carbonyl]-7 alpha-methoxy-8-oxo-5-thia-1-azabicyclo[4.2.0]oct-2-ene, 5,5-dioxide (3, L-658,758) as a selective, potent, time-dependent HLE inhibitor suitable for formulation as a topical aerosol drug for possible clinical use.