TAN‐1057 (1a, b) − a new natural dipeptide antibiotic active against methicillin resistant strains of Staphylococcus aureus − was synthesized starting from Nα, Nδ, Nω‐tri‐Z‐L‐arginine 20b via the corresponding diazoketone 21b. This upon photolysis rearranged to the ketene which was trapped by (±)‐2,4,5,6‐tetrahydro‐5‐methylamino‐2‐ureidopyrimidin‐4‐one (3) to yield the fully protected dipeptide 23 (30%). The latter was deprotected by hydrogenolysis to give the final compound as a mixture of two epimers − TAN‐1057A, B − isolated previously from a strain of Flexibacter sp. PK‐74. The intermediate 3 was prepared from 3‐amino‐2‐(N‐Z‐N‐methylamino)propionic acid methyl ester hydrochloride (16) and 2‐methyl‐2‐thiopseudobiuret hydroiodide (18) in one step in 35% yield.