Pharmaceutically prospective 2‐substituted‐4,5‐dimethyloxazoles are synthesized in up to 58% yield via unprecedented cascade assembly of one molecule of primary amide with two molecules of acetylene gas in the KOH/MeOH/DMSO (90 oC, 2 h) catalytic triad. This oxazoles self‐organization demonstrates unexpected successful competition of with the alkaline hydrolysis of amides. The mechanism involving amide N‐vinylation, enamine‐imine isomerization, imine ethynylation and intramolecular О‐vinylation cascade sequence has been deduced and supported by quantum‐chemical calculations using the B2PLYP‐D3/6‐311+G**//B3LYP/6‐31+G* + IEF PCM (B3LYP/6‐31+G*) approach..