A highly regio- and stereoselective Pd-catalyzed cascade reaction of allenoate adducts has been developed. Various allenoate adducts of phosphine-catalyzed addition of allenoates are found to be efficient substrates for the preparation of 2,3-dihydrobenzofuran. It is the first example of allenoate adducts used as ideal and practical precursors of hard-to-get functionalized 1,3-butadienes for heterocycle synthesis.