A modified vancomycin binding pocket (D-O-E ring) incorporating an alpha-hydroxy-beta-amino acid at the AA4 position is designed and synthesized. Some of these compounds display potent bioactivities against both sensitive- and resistant-strains (8 microg/ml against VREF). Both the lipidated aminoglucose and the structure of the 16-membered macrocycle are found to be important for the anti-VRE activities. The polyamine appendage at the C-terminal, on the other hand, improved the activity against vancomycin-sensitive strains.