Irradiation of 2-nitrobenzyl alcohol (1, R = H) and 1-(2-nitrophenyl)ethanol (1, R = Me) in various solvents yields 2-nitroso benzaldehyde (4, R = H) and 2-nitroso acetophenone (4 R = Me), respectively, with quantum yields of about 60%. The mechanism of this reaction, known since 1918, was investigated using laser flash photolysis, time-resolved infrared spectroscopy (TRIR), and 18O-labeling experiments. The primary aci-nitro photoproducts 2 react by two competing paths. The balance between the two depends on the reaction medium. Reaction via hydrated nitroso compounds 3 formed by proton transfer prevails in aprotic solvents and in aqueous acid and base. In water, pH 3-8, the classical mechanism of cyclization to benzisoxazolidine intermediates 5, followed by ring opening to carbonyl hydrates 6, predominates. The transient intermediates 3 and 6 were identified by TRIR. Potential energy surfaces for these reactions were mapped by density functional calculations.