Ylide-type reactivity of diazo compounds is exploited in a new way to prepare benzo[ b]oxepines thanks to the formation of three chemical bonds and two contiguous and highly substituted stereocenters in a single pot. This cationic reaction cascade first involves addition of a donor-acceptor-substituted diazo compound to a benzopyrylium. Selective 1,2 migration of the endocyclic C-C bond then results in a ring-expansion and generates a second oxocarbenium that is trapped by a nucleophile added sequentially.