A straightforward approach to synthesise isocoumarins via Rh(III)-catalyzed C-H/C-C bond activation/annulation cascade of enaminones and iodonium ylides has been explored. The established protocol is characterized by an exceedingly simple reaction system, high regioselectivity and good functional group tolerance. Moreover, this strategy may provide a new route to cleavage of the C(sp2)-C(O) bond of unstrained ketones.