γ-Glutamyl transpeptidase (GGT) catalyzing the cleavage of γ-glutamyl bond of glutathione and its S-conjugates is involved in a number of physiological and pathological processes through glutathione homeostasis. Defining its Cys-Gly binding site is extremely important not only in defining the physiological function of GGT, but also in designing specific and effective inhibitors for pharmaceutical purposes. Here we report the synthesis and evaluation of a series of glutathione-analogous peptidyl phosphorus esters as mechanism-based inhibitors of human and Escherichia coli GGTs to probe the structural and stereochemical preferences in the Cys-Gly binding site. Both enzymes were inhibited strongly and irreversibly by the peptidyl phosphorus esters with a good leaving group (phenoxide). Human GGT was highly selective for l-aliphatic amino acid such as l-2-aminobutyrate (l-Cys mimic) at the Cys binding site, whereas E. coli GGT significantly preferred l-Phe mimic at this site. The C-terminal Gly and a l-amino acid analogue at the Cys binding site were necessary for inhibition, suggesting that human GGT was highly selective for glutathione (γ-Glu-l-Cys-Gly), whereas E. coli GGT are not selective for glutathione, but still retained the dipeptide (l-AA-Gly) binding site. The diastereoisomers with respect to the chiral phosphorus were separated. Both GGTs were inactivated by only one of the stereoisomers with the same stereochemistry at phosphorus. The strict recognition of phosphorus stereochemistry gave insights into the stereochemical course of the catalyzed reaction. Ion-spray mass analysis of the inhibited E. coli GGT confirmed the formation of a 1:1 covalent adduct with the catalytic subunit (small subunit) with concomitant loss of phenoxide, leaving the peptidyl moiety that presumably occupies the Cys-Gly binding site. The peptidyl phosphonate inhibitors are highly useful as a ligand for X-ray structural analysis of GGT for defining hitherto unidentified Cys-Gly binding site to design specific inhibitors.