We report the first example of Pd(II)-catalyzed γ-C(sp3)-H activation of ketones directed by a practical 2,2-dimethyl aminooxyacetic acid auxiliary. 2-Pyridone ligands are identified to enable C(sp3)-H activation for the first time. A rare six-membered palladacycle intermediate is isolated and characterized to elucidate the reaction mechanism. Both (hetero)arylation and vinylation of γ-C(sp3)-H bonds are demonstrated. Sequential β- and γ-C(sp3)-H (hetero)arylation of muscone showcases the utility of this method for late-stage diversification. A convenient Mn(II)-catalyzed auxiliary removal is also developed to further underscore the practicality of this transformation.