Dipeptidyl peptidase III (DPP III) was originally thought to be a housekeeping enzyme that contributes to intracellular peptide catabolism. More specific roles for this cytosolic metallopeptidase, in the renin-angiotensin system and oxidative stress regulation, were confirmed, or recognized, only recently. To prove indicated (patho)physiological functions of DPP III in cancer progression, cataract formation and endogenous pain modulation, or to reveal new ones, selective and potent inhibitors are needed. This review encompasses natural and synthetic compounds with experimentally proven inhibitory activity toward mammalian DPP III. Except for the polypeptide aprotinin, all others are small molecules and include flavonoids, coumarin and benzimidazole derivatives. Presented are current strategies for the discovery or development of DPP III inhibitors, and mechanisms of inhibitory actions. The most potent inhibitors yet reported (propioxatin A and B, Tyr-Phe- and Phe-Phe-NHOH, and JMV-390) are active in low nanomolar range and contain hydroxamic acid moiety. High inhibitory potential possesses oligopeptides from the hemorphin group, valorphin and tynorphin, which are poor substrates of DPP III. The crystal structure of human DPP III-tynorphin complex enabled the design of the transition-state peptidomimetics inhibitors, effective in low micromolar concentrations. A new direction in the field is the development of fluorescent inhibitor for monitoring DPP III activity.