Methods for the synthesis of .alpha.-hydroxy-.beta.-amino acid and amide derivatives and .alpha.-ketoamide derivatives and novel derivatives made by these methods are provided. These methods involve reacting a N-terminally blocked (protected) aminoaldehyde with an isonitrile and a carboxylic acid to give an amino-.alpha.-acyloxy carboxamide. The acyloxy group may be removed to give the derivative. Alternatively the protecting group is removed and acyl shift occurs to give the derivative. These derivatives are useful in the synthesis of compounds such as peptidyl .alpha.-ketoamides and .alpha.-hydroxy-.beta.-carboxylic acid and amide derivatives. Certain of these compounds have been reported to have activity as inhibitors of proteases, such as serine proteases and cysteine proteases.