An evaluation of [3’-(2-aminoethyl)-2-biphenyl]propionic acid (1) and 2-amino-3’-biphenylcarboxylic acid (2) as beta-sheet nucleators was accomplished by incorporating these residues into water soluble peptides. Residue 1 was designed to replace the backbone of the i + 1 and i + 2 residues of a beta-turn and reverse the polypeptide chain direction via a hydrogen-bonded hydrophobic cluster to initiate beta-hairpin folding. An NMR structural evaluation of heptapeptides incorporating 1 revealed the presence of a hydrophobic cluster involving an aromatic ring of 1 and a side chain of one of the flanking hydrophobic alpha-amino acids, even though the peptides lack sufficient length to adopt a beta-sheet structure. The flanking alpha-amino acid residues in these peptides exhibit significantly slower amide proton/deuterium exchange rates, indicating that they are intramolecularly hydrogen bonded in aqueous solution. In appropriate tridecapeptides, the hydrogen-bonded hydrophobic cluster nucleates the formation of a beta-hairpin structure which subsequently self-associates. Unlinking the intramolecular folding and self-association equilibria was accomplished by strategically replacing two of the exterior amide protons in the tridecapeptide with methyl groups. These tertiary amide groups cannot act as hydrogen bond donors and sterically block the intermolecular beta-sheet interactions between exterior beta-strands, preventing self-assembly. The N-methylated tridecapeptide incorporating 1 has been characterized by analytical equilibrium ultracentrifugation, far-UV CD, FT-IR, and a variety of NMR experiments which support a beta-hairpin-like structure. Interestingly, these peptides exhibit an increase in beta-sheet structure with increasing temperature which may prove to be general for beta-sheets stabilized by hydrophobic interactions. The incorporation of residue 2 into an identical alpha-amino acid sequence does not result in folding under the same conditions, implying that the hydrogen-bonded hydrophobic cluster promoted by 1 is required for beta-hairpin folding.