From the ethyl acetate extract of the soft coral Sinularia arborea, a new cembrane-type diterpenoid, arbolide C (1), along with (+)-sarcophytol T (2), an enantiomer of the known cembrane, sarcophytol T, were isolated. The structures of compounds 1 and 2 were established by spectroscopic methods and 1 was found to display an inhibitory effect on the release of elastase by human neutrophils.