The molecular determinants responsible for the potency of the RXP470.1 phosphinic peptide inhibitor toward matrix metalloprotease-12 (MMP-12) remain elusive. To address this issue, structure-activity study, X-ray crystallography, and isothermal titration calorimetry (ITC) experiments were performed. The crystal structure of MMP-12/inhibitor complex (1.15 Å) reveals that the inhibitor establishes multiple interactions with the MMP-12 active site, with its long P(1)' side chain filling most of the S(1)' deep cavity. ITC experiments indicate that the binding of this inhibitor to MMP-12 is mostly entropy driven (ΔG° = -13.1 kcal/mol, ΔH° = -2.53 kcal/mol, and -TΔS° = -10.60 kcal/mol) and involves a proton uptake from the buffer. Comparing phosphinic versus hydroxamate inhibitors reveals that the chelation of the zinc ion is slightly different, leading the inhibitor backbone to adopt a position in which the hydrogen bonding with the MMP-12 active site is less favorable in phosphinic inhibitor while maintaining high affinity.