The COVID-19 pandemic has been disastrous to society and effective drugs are urgent needed. The papain-like protease domain (PLpro) of SARS-CoV-2 (SCoV2) is indispensable for viral replication and represents a putative target for pharmacological intervention. In this work, we describe the development of a potent and selective SCoV2 PLpro inhibitor, 19. The inhibitor not only effectively blocks substrate cleavage and immunosuppressive function imparted by PLpro, but also markedly mitigates SCoV2 replication in human cells with a submicromolar IC50. We further present a convenient and sensitive activity probe, 7, and complementary assays to readily evaluate SCoV2 PLpro inhibitors in vitro or in cells. Additionally, we disclose the co-crystal structure of SCoV2 PLpro in complex with a prototype inhibitor, which illuminates their detailed binding mode. Overall, these findings provide promising leads and important tools for drug discovery aiming to target SCoV2 PLpro.