Signal peptidases are serine endoproteinases responsible for the proteolytic removal of N-terminal amino acid signal sequences from pre-secretory proteins in all cellular lifeforms including bacteria. The demonstrated essentiality of the enzymatic activity and the ubiquitous occurrence in bacteria, coupled with the significant molecular differences between bacterial signal peptidases and those of eukaryotes, define these enzymes as potential molecular targets for the development of novel antibacterial agents. Few compounds are known to inhibit bacterial signal peptidases and the most significant advance in SPase inhibition has been the discovery of penem systems as time dependent irreversible inhibitors. They are thought to act via acylation of the active site serine. SPases are only acylated by the 5S penem stereochemistry, a stereochemical preference mirrored in other azetidinone containing inhibitors. The implications of this is that the active site serine of SPases approach their substrate from the opposite side of the peptidic backbone to that of all other serine protease families whose structures are known. The activity of penems is significantly enhanced by the incorporation of a C6 hydroxyethyl substituent, thought to bind into the S1 pocket of the enzyme. Penem inhibition of SPases has been demonstrated in vitro, in isolated enzyme assays, and in vivo in pulse-chase assays.