A diastereoselective mercury(II)-promoted intramolecular cyclization of unsaturated aldehyde via an oxazolidine to prepare C-3-substituted tetrahydroisoquinoline is disclosed. The C-3 stereogenic center is subsequently exploited to create the C-1 stereocenter by coordination of the nucleophilic reagent to the oxygen atom of oxazolidine. Both cis- and trans-1,3-disubstituted tetrahydroisoquinolines can be readily prepared. In addition, when a cationic rhodium complex was used, intramolecular hydroamination was effected, thus avoiding mercury(II) salts and demercuration. The reaction is general and works well using aliphatic and aromatic aldehydes.