We report herein an unprecedented hypervalent iodine(III)‐catalysis using the activated sulfoxide. Since the present catalytic systems promote the dehydrogenative cycloisomerization‐arylation reaction of 2‐propargyl 1,3‐dicarbonyl compounds with aromatics, this report also provides one of the few methods for iodine(III)‐catalyzed intermolecular carbon‐carbon bond formation of aromatics.