A palladium‐catalyzed domino approach to the synthesis of 10,11‐dihydro‐5H‐dibenzo[b,e][1,4]diazepines starting from o‐phenylenediamines and 2‐bromobenzyl bromides or tosylates has been developed. Mechanistic studies support the following domino sequence. Intermolecular mono‐N‐benzylation of the o‐phenylenediamine through oxidative palladium insertion, primarily at the benzylic position of the 2‐bromobenzyl bromide, is followed by intramolecular N′‐arylation. The intramolecular N′‐arylation is demonstrated to be facilitated by coordination of a remote auxiliary nitrogen atom to the palladium atom.