Formal intramolecular 1,3-OH migration of α-imino carbene was achieved producing a unique zwitterion, and the subsequent selective annulation afforded α-amino cyclobutanone. Features such as readily available substrates, mild reaction conditions, a time-saving procedure, excellent functional group compatibility, and valuable transformations of the products qualified this unique protocol as an efficient tool for the synthesis of strained cyclic compounds. Density functional theory calculations were in good agreement with experimental observations, and a plausible mechanism is presented.