Abstract Phosphodiesterase-4 (PDE4) is a key enzyme in cAMP hydrolysis and is involved in various inflammatory and fibrotic diseases, such as ulcerative colitis (UC). PDE4 inhibition elevates intracellular cAMP, downregulates inflammatory cytokines (e.g., TNFα), and reduces cell adhesion molecules, thereby preventing local infiltration of inflammatory cells. Several PDE4 inhibitors (e.g., roflumilast and apremilast) are approved for COPD and psoriasis, with others under development for diseases such as idiopathic pulmonary fibrosis (IPF). Phase 2 clinical trials have shown that oral PDE4 inhibitors enhance clinical remission in UC patients, with a 20% placebo-adjusted improvement with low-dose apremilast. However, oral administration and systemic distribution cause central nervous system (CNS) toxicity (e.g., headaches, nausea, vomiting), leading to therapy discontinuation and limiting efficacy. Targeted and better-tolerated oral treatments are needed to fully exploit PDE4 inhibitors in UC. We assessed the efficacy of PALI-2108, an oral and locally bioactivated PDE4 inhibitor prodrug for UC treatment. PALI-2108 incorporates a galactose-derived sugar moiety, making it minimally absorbed until cleaved by the colonic bacterium enzyme β-glucuronidase. In a DSS-induced UC mouse model, PALI-2108 demonstrated that at doses of 21, 4, 0.75 mg/kg BID, and 1.5 mg/kg daily, it reduced the mean disease activity index (DAI) score over time compared to the DSS control group (Fig 1). Additionally, body weight loss over time was attenuated in the 21 and 4 mg/kg BID groups (Fig 2). A tissue distribution study showed colon preference of PALI-2108 with limited plasma levels and a colon/plasma AUC ratio exceeding 200. Additionally, oxazolone colitis induced mice treated with PALI-2108 showed colon-selective bioactivation, with negligible plasma levels compared to duodenal and ileal tissue. In a target engagement study, we used a CETSA Navigate® assay to measure PALI-2108 binding to cAMP-specific 3’, 5’-cyclic PDE4D in OXZ-treated mice. Melt and shift curves showed similar changes, indicating comparable target engagement in colon tissues between PALI-2108 and apremilast. Finally, in a tolerated dose study, we showed no CNS toxicity and emesis over effective doses in dogs. In conclusion, our results demonstrate local bioactivation of a PDE4 inhibitor pro-drug, PALI-2108, and its colon-specific distribution with limited systemic exposure. PALI-2108 has similar target engagement to other PDE4 inhibitors, dose-dependent efficacy in a UC model, and no systemic toxicity. We believe PALI-2108 is a promising novel therapy for UC, with localized bioactivation, expanded therapeutic window, and potent PDE4 inhibitory activity. PALI-2108 is in development for moderate-to-severe UC and is advancing toward regulatory filing for first-in-human studies. PALI-2108 reduced DSS induced mean disease activity index score (DAI) over time compared to control. PALI-2108 attenuated DSS induced body weight loss over time compared to control.