Irradiation of 2-(alkoxymethyl)-5-methyl-alpha-chloroacetophenones (1a-c) and 2-(methoxymethyl)-5-methylphenacyl benzoate (1d) in dry, nonnucleophilic solvents afforded 3-alkoxy-6-methylindan-1-ones (3a-c) in very high chemical yields. 3-Methylisobenzofuran-1(3H)-one (2) was, however, isolated as a major photoproduct in the presence of trace amounts of water. Quenching experiments and laser flash spectroscopy revealed that the indanone derivatives 3 are formed by 1,5-hydrogen migration from the lowest triplet excited state of the acetophenones 1 and cyclization of the resulting photoenols. In contrast, production of the lactone 2 in wet solvents was found to result from two consecutive photochemical transformations. The photoenols produced by photolysis of 1a-c add water as a nucleophile to form 2-acetyl-4-methylbenzaldehyde (4), which is further converted to 2 via a second, singlet state photoenolization process. Exhaustive photolysis of 1a in methanol produced the acetal 2-(dimethoxymethyl)-5-methylacetophenone (7a) as the exclusive product. The remarkable selectivity of these photoreactions may well be useful in synthetic organic chemistry.