The 3-alkoxy-1-N-toluenesulfonyl azopropene structural motif has been known in the context of the Eschenmoser-Tanabe fragmentation for over 50 years. It is derived from a-epoxy N-toluenesulfonyl hydrazones by deprotonation and epoxide ring opening. A very interesting yet unreported feature of these intermediates is their putative 1,3-dipolar nature and the potential to use them in reactions with complimentary dipoles to enable novel ring-expansion methods for the synthesis of saturated and partially saturated oxygen heterocycles. Herein, we describe such a transformation that requires the simple combination of an ester or acyl pyrrole, an a-epoxy 2-nitrophenyl hydrazone, and a commercially available base (KHMDS or LiHMDS) and leads to the highly (up to >25:1) diastereoselective synthesis of b,g-fused bicyclic g-lactones (an important class of chiral oxygen heterocycles), including those with quaternary centers. Conveniently, both synand anti-fused bicyclic systems can be generated stereoselectively through a simple modification of the reaction conditions.