Casitas B-lineage lymphoma proto-oncogene-b (Cbl-b), a member of the Cbl family of RING finger E3 ubiquitin ligases, plays a critical role in negatively regulating T-cell, natural killer (NK) cell, and B-cell activation. Inhibiting Cbl-b has emerged as a promising immuno-oncology strategy to enhance immune cell function. Here, we describe the rational design and optimization of pyrrolo-pyridone derivatives as potent Cbl-b inhibitors. Using structure-based drug design, we identified key structural elements that enhance binding affinity and inhibitory potency. Notably, compound B2 stands out, showing superior potency in stimulating IL-2 production in T cells and modulating phosphorylation of key proteins in T-cell receptor signaling. Furthermore, B2 demonstrates favorable pharmacokinetics and significantly inhibits tumor growth in vivo, outperforming NX-1607, which is currently in clinical trials.