A method involving tandem activation of γthiolactone by silver-DABCO pair has been developed to enable successful amidation of homocysteine thiolactone by various amino acid residues and dipeptides with yields up to 95%. The introduction of thiol functionality to peptides directly using cysteine or homocysteine would require the protection of the reactive sulfhydryl groups and deprotection at a later stage of the synthesis. The γ-thiolactone chemistry presented herein shows that it could serve as a masked and activatable reaction handle to prepare a range of thiol-containing peptides in a more atom-economical way. The resulting thiol-containing peptides could facilitate late-stage functionalization and structural diversification of functional or bioactive peptides. The silver(I) ion was found to be essential for the activation of the γ-thiolactone, poor reactions were observed otherwise. A tentative mechanism for the silver-DABCO promoted γ-thiolactone aminolysis was proposed and supported by the evidence from thermal desorption electrospray ionization mass spectrometry.