The fatty acid ethanolamides (FAEs) are a family of bioactive lipid mediators that include the endogenous agonist of peroxisome proliferator-activated receptor-alpha, palmitoylethanolamide (PEA). FAEs are hydrolyzed intracellularly by either fatty acid amide hydrolase or N-acylethanolamine-hydrolyzing acid amidase (NAAA). Selective inhibition of NAAA by (S)-N-(2-oxo-3-oxetanyl)-3-phenylpropionamide [(S)-OOPP, 7a] prevents PEA degradation in mouse leukocytes and attenuates responses to proinflammatory stimuli. Starting from the structure of 7a, a series of beta-lactones was prepared and tested on recombinant rat NAAA to explore structure-activity relationships (SARs) for this class of inhibitors and improve their in vitro potency. Following the hypothesis that these compounds inhibit NAAA by acylation of the catalytic cysteine, we identified several requirements for recognition at the active site and obtained new potent inhibitors. In particular, (S)-N-(2-oxo-3-oxetanyl)biphenyl-4-carboxamide (7h) was more potent than 7a at inhibiting recombinant rat NAAA activity (7a, IC(50) = 420 nM; 7h, IC(50) = 115 nM) in vitro and at reducing carrageenan-induced leukocyte infiltration in vivo.