5-Hydroxyfuran-2(5H)-one 1, a readily available renewable resource, was used as an electrophile in the Friedel-Crafts alkylation of indoles catalyzed by a diphenylprolinol silyl ether. Moderate catalyst loading was achieved because of the high reactivity of 5-hydroxyfuran-2(5H)-one 1 in this process. Reduction of the Friedel-Crafts adduct (FC adduct) afforded indoyl lactones in high yield and enantioselectivity. Moreover, the FC adduct was used as a chiral synthon in a diversity-oriented synthesis, as illustrated by its successful engagement in a 4-center 3-component Ugi reaction (U-4C-3CR) to afford chiral five-membered lactams in high yield and enantioselectivity.