Site‐selective “cut and sew” transformations employing diazo compounds and hypervalent iodine(III) compounds involve the departure of leaving groups, a “cut” process, followed by a reorganization of the fragments by bond formation, a “sew” process. Bearing controllable cleavage sites, diazo compounds and hypervalent iodine(III) compounds play a critical role as versatile reagents in a wide range of organic transformations because their excellent nucleofugality allows for a large number of unusual reactions to occur. In recent years, the combination of diazo compounds and hypervalent iodine(III) reagents has emerged as a promising tool for developing new and valuable approaches, and has met considerable success. In this Minireview, this combination is systematically illustrated with recent advances in the field, with the aim of elaborating the synthetic utility and potential of this concept as a powerful strategy in organic synthesis.