Inappropriate activation of endosomal TLR7 and TLR8 occurs in several autoimmune diseases, in particular systemic lupus erythematosus (SLE). Herein, the development of a TLR8 antagonist competition assay and its application for hit generation of dual TLR7/8 antagonists are reported. The structure-guided optimization of the pyridone hit 3 using this biochemical assay in combination with cellular and TLR8 cocrystal structural data resulted in the identification of a highly potent and selective TLR7/8 antagonist (27) with in vivo efficacy. The two key steps for optimization were (i) a core morph guided by a TLR7 sequence alignment to achieve a dual TLR7/8 antagonism profile and (ii) introduction of a fluorine in the piperidine ring to reduce its basicity, resulting in attractive oral pharmacokinetic (PK) properties and improved TLR8 binding affinity.