Hydroxy-substituted cephalosporins, particularly 7-(.alpha.-hydroxy-arylacetamido)-3-substituted-3-cephem-4-carboxylic acids of the formula: ##STR1## wherein R is a hydrogen atom, an esterified carboxy or carboxy group, and Y is a lower alkanoyl, lower alkoxy or azido group or a group of the formula: --SR.sub.3 in which R.sub.3 is a heterocyclic residue. These compounds have antibacterial activity against Gram-positive and Gram-negative bacteria.