A program to improve upon the in vitro, in vivo, and physicochemical properties of N-hydroxyformamide TACE inhibitor GW 3333 (1) is described. Using the primary structure of pro-TNF-alpha, along with a homology model of the catalytic domain of TACE based on the X-ray diffraction coordinates of adamalysin, we synthesized N-hydroxyformamide TACE inhibitors containing a P2' arginine side chain. Introduction of nitro and sulfonyl electron-withdrawing groups covalently bound to the P2' guanidine moiety rendered the inhibitors electronically neutral at cellular pH and led to potent inhibition of TNF-alpha release from stimulated macrophages. Inhibitors containing these arginine mimetics were found to have increased solubility in simulated gastric fluid (SGF) relative to 1, allowing for the incorporation of lipophilic P1' side chains which had the effect of retaining potent TACE inhibition, but reducing potency against matrix metalloproteases (MMPs) thus increasing overall selectivity against MMP1, MMP3, and MMP9. Selected compounds showed good to excellent in vivo TNF inhibition when administered via subcutaneous injection. One inhibitor, 28a, with roughly 10x selectivity over MMP1 and MMP3 and high solubility in SGF, was evaluated in the rat zymosan-induced pleuisy model of inflammation and found to inhibit zymosan-stimulated pleural TNF-alpha elevation by 30%.