Heterocyclic hypervalent (HV) iodine(III) compounds with ICl bonds and various substituents at the N atom are synthesized and found to be very efficient chain transfer agents in the polymerization of styrene with transfer coefficients exceeding that of CCl4 by 2–3 orders of magnitude, depending on the structure. The chain transfer rate coefficients are also determined. Due to the presence of thermally labile HV bonds, the compounds degrade homolytically upon heating and can initiate radical polymerization. For instance, 1‐chloro‐2‐hexyl‐1,2‐benziodazol‐3(2H)‐one, is used in the polymerization of styrene, which yields low molecular weight polymers with alkyl chloride groups at the α‐ (initiation) and the ω‐chain ends (transfer). Chain‐end functionalization reactions with azide and chain extension under low‐catalyst‐concentration atom transfer radical polymerization (ATRP) conditions of the prepared telechelic polymers are carried out. The same initiator/chain transfer agent is successfully employed in the synthesis of highly branched polymers with multiple alkyl chloride‐type chain ends when added to mixtures of styrene and 1,4‐divinylbenzene containing 10–80 mol% of the divinyl crosslinker, or even pure crosslinker. In all cases, soluble hyperbranched polymers are obtained up to moderate monomer conversions. The effects of crosslinker and HV iodine(III) compound concentrations on the polymerization outcome are studied systematically.