The 2019 coronavirus disease (COVID-19), caused by the emerging severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2), has posed serious threats to global public health and economic and social stabilities, calling for the prompt development of therapeutics and prophylactics. In this study, we first verified that SARS-CoV-2 uses human angiotensin-converting enzyme 2 (ACE2) as a cell receptor and that its spike (S) protein mediates high membrane fusion activity. The heptad repeat 1 (HR1) sequence in the S2 fusion protein of SARS-CoV-2 possesses markedly increased α-helicity and thermostability, as well as a higher binding affinity with its corresponding heptad repeat 2 (HR2) site, than the HR1 sequence in S2 of severe acute respiratory syndrome coronavirus (SARS-CoV). Then, we designed an HR2 sequence-based lipopeptide fusion inhibitor, termed IPB02, which showed highly potent activities in inhibiting SARS-CoV-2 S protein-mediated cell-cell fusion and pseudovirus transduction. IPB02 also inhibited the SARS-CoV pseudovirus efficiently. Moreover, the structure-activity relationship (SAR) of IPB02 was characterized with a panel of truncated lipopeptides, revealing the amino acid motifs critical for its binding and antiviral capacities. Therefore, the results presented here provide important information for understanding the entry pathway of SARS-CoV-2 and the design of antivirals that target the membrane fusion step.IMPORTANCE The COVID-19 pandemic, caused by SARS-CoV-2, presents a serious global public health emergency in urgent need of prophylactic and therapeutic interventions. The S protein of coronaviruses mediates viral receptor binding and membrane fusion, thus being considered a critical target for antivirals. Herein, we report that the SARS-CoV-2 S protein has evolved a high level of activity to mediate cell-cell fusion, significantly differing from the S protein of SARS-CoV that emerged previously. The HR1 sequence in the fusion protein of SARS-CoV-2 adopts a much higher helical stability than the HR1 sequence in the fusion protein of SARS-CoV and can interact with the HR2 site to form a six-helical bundle structure more efficiently, underlying the mechanism of the enhanced fusion capacity. Also, importantly, the design of membrane fusion inhibitors with high potencies against both SARS-CoV-2 and SARS-CoV has provided potential arsenals to combat the pandemic and tools to exploit the fusion mechanism.