A palladium-catalyzed decarboxylative cyclopropanation of γ-methylidene-δ-valerolactones with aromatic aldehydes has been developed to give 4-oxaspiro [2.4] heptanes with high selectivity. The site of nucleophilic attack to a π-allylpalladium intermediate has been controlled with a sterically demanding phosphine ligand. The course of the reaction is highly dependent on ligands and solvents, and selective formation of methylenetetrahydropyrans ...