The selective tagging of amino acids within a peptide framework while using atom-economical C–H counterparts poses an unmet challenge within peptide chemistry. Herein, we report a novel Pd-catalyzed late-stage C–H acylation of a collection of Tyr-containing peptides with alcohols. This water-compatible labeling technique is distinguished by its reliable scalability and features the use of ethanol as a renewable feedstock for the assembly of a variety of peptidomimetics.