CD28 is the prototypical costimulatory receptor that integrates with TCR signaling to sustain T-cell activation, proliferation, and survival. While indispensable for adaptive immunity, persistent CD28 signaling drives autoimmunity, graft-versus-host disease, and inflammatory pathology. Despite its therapeutic relevance, CD28 has long been regarded as an undruggable target due to its flat, solvent-exposed dimer interface, restricting modulation to biologics. Previous reports of small molecule CD28 inhibitors have been limited by weak potency. Here, we report the first structure-guided optimization yielding a best-in-class small molecule CD28 antagonist that overcomes these limitations. Guided by biophysical and functional assays, optimization of the preliminary CD28 hits 8VS and 22VS yielded BPU11, a chemically tractable lead with markedly improved pharmacokinetic stability, aqueous solubility, and plasma persistence. BPU11 consistently disrupted CD28–B7 interactions across biochemical and cellular systems, and potently suppressed T-cell activation in both a tumor–PBMC co-culture and a human PBMC–mucosal tissue model, functionally mimicking the biologic antagonist FR104. Molecular docking and dynamics simulations revealed engagement of the lipophilic canyon of CD28 through stabilizing hydrogen-bonding and hydrophobic interactions. These findings redefine the druggability of CD28, expand the pharmacological space of immune checkpoint modulation beyond antibodies, and establish BPU11 as a foundation for next-generation small molecule immunotherapies