The [3,3]-rearrangement of aryl iodanes with α,β-unsaturated oxazolines has been developed by merging Morita-Baylis-Hillman (MBH) process into the rearrangement reaction. The method allows for the exclusively E-selective synthesis of a wide variety of valuable α-aryl α,β-unsaturated oxazolines which can be difficult to synthesize with other known methods. Experimental and computational mechanistic studies unraveled that the reaction proceeds via the assembly of both coupling partners followed by MBH-type addition to form rearrangement precursor, [3,3]-rearrangement, and stepwise E1cb-elimination. The E-selectivity of the reaction is favored both kinetically and thermodynamically.