Density functional theory calculations were conducted to develop a mechanistic understanding of the Rh(III)-catalyzed C-H activation/cycloaddition reactions of N-phenoxyacetamide and N-pivaloxybenzamide with cyclopropenes, and insights into the substrate-dependent chemoselectivity were provided. The results showed that the divergence originated from the different reactivity of the seven-membered rhodacycles from the insertion of cyclopropene into the Rh-C bond. In reactions of N-pivaloxybenzamide, such an intermediate undergoes the pivalate migration to form a cyclic Rh(V)-nitrenoid intermediate in a reaction that is easier than the opening of the three-membered ring by β-carbon elimination, leading finally to a tricyclic product with retention of the cyclopropane moiety by facile reductive elimination. While similar Rh(V)-nitrenoid species could also be possibly formed in Cp*Rh(III)-catalyzed reactions of N-phenoxyacetamide, the β-carbon elimination occurs more easily from the corresponding seven-membered rhodacycle intermediate and the subsequent O-N bond cleavage gives rise to an unexpected dearomatized (E)-6-alkenylcyclohexa-2,4-dienone intermediate. The E/Z isomerization of this intermediate is required for the final cyclization to 2H-chromene, and interesting metal-ligand cooperative catalysis with Rh(III) carboxylate was disclosed in the C═C double bond rotation process.