Substrate-selective inhibition or modulation of the activity of γ-secretase, which is responsible for the generation of amyloid-β peptides, might be an effective strategy for prevention and treatment of Alzheimer's disease. We have shown that helical β-peptide foldamers are potent and specific inhibitors of γ-secretase. Here we report identification of target site of the foldamers by using a photoaffinity probe. The photoprobe directly and specifically labeled the N-terminal fragment of presenilin 1, in which the initial substrate docking site is predicted to be located. We also optimized the foldamer structure by preparing a variety of derivatives and obtained two highly potent foldamers by incorporation of a hydrophilic and neutral functional group into the parent structure. The class of side chain functional group and the position of incorporation were both important for γ-secretase-inhibitory activity. The substrate selectivity of the inhibitory activity was also quite sensitive to the class of side chain group incorporated.