A practical, one-pot process for the preparation of beta-keto amides via a three-component reaction, including Meldrum's acid, an amine, and a carboxylic acid, has been developed. Key to development of an efficient, high-yielding process was an in-depth understanding of the mechanism of the multistep process. Kinetic studies were carried out via online IR monitoring and subsequent principal component analysis which provided a means of profiling the concentration of both the anionic and free acid forms of the Meldrum's adduct 6 in real time. These studies, both in the presence and absence of nucleophiles, strongly suggest that formation of beta-keto amides from acyl Meldrum's acids occurs via alpha-oxoketene species 2 and rule out other possible reaction pathways proposed in the literature, such as via protonated alpha-oxoketene intermediates 3 or nucleophilic addition-elimination pathways.