Catalytic reaction of arylhydroxamic acids with alkenes represents a convenient method for preparation of biologically active dihydroisoquinolones. Here, the rhodium(III) complex [(C H tBu CH tBu)RhCl ] , which allows one to carry out such reactions with high regioselectivity to obtain 4-substituted dihydroisoquinolones in 72-97 % yields, is described. The regioselectivity is provided by the bulky cyclopentadienyl ligand of the catalyst, which is formed through a [2+2+1] cyclotrimerization of tert-butylacetylene. The catalytic reaction tolerates various distant functional groups in alkenes, but is inhibited by bulky (e.g., tBu) or strongly coordinating (e.g., imidazolyl) substituents. Some of the prepared dihydroisoquinolones effectively inhibit growth of phytopathogenic fungi.