A variety of isocoumarins have been synthesized directly from 2-halobenzoates and ketones through a palladium-catalyzed α-arylation step followed by an intramolecular cyclization process. The addition of iodide anions to the reaction mixture increased yields and selectivities especially when 2-bromobenzoates were employed. This phosphine-free one-pot synthesis features a high functional group tolerance and gives access to richly decorated isocoumarins. This general methodology was successful in the total synthesis of Xyridin A, an important natural product with antibacterial and antifungal activity.