This manuscript describes an unusual Pd-catalyzed rearrangement reaction. It provides efficient access to 1-phenanthrol derivatives using allyloxy-tethered aryl iodides. This rearrangement process involves the cleavage of a C-I bond, a C-O bond and C-H bonds, and the formation of two C-C bonds in one-pot. It is likely that the key to the success of this rearrangement is via β-carbon elimination from a strained palladacycle.