Abstract: A unique method for the synthesis of substantially pure .alpha.-keto bisphosphonate esters and the usage of these esters in reactions with C, N, O, or P nucleophiles for synthesis of .alpha.-functionalized bisphosphonates. The method starts with a reaction mixture formed of an .alpha.-diazo methanediphosphonate ester, including tert-butylchlorite, a polar aprotic organic solvent, and an effective amount of water. After synthesis is complete, a water trapping reagent may be added to remove any excess water. The present invention provides a versatile pathway to new .alpha.-substituted bisphosphonate derivatives and could be readily adapted to combinatorial drug discovery synthetic strategies. The .alpha.-keto bisphosphonate esters can be converted to the corresponding acids by acid hydrolysis or mild silyldealkylation.