Phenols are readily available by degradation of lignin resource. Palladium-catalyzed conversion of phenols to tetrahydro-β-carboline skeletons bearing a spirocycle at the C-1 position in water is reported. Various substituted phenols are successfully cross-annulated with different tryptamines via sequential C(Ar)-O bond cleavage of phenols, C-H bond activation of tryptamines, and C-N/C-C bond formations. This method provides a new protocol of converting lignin phenols into high-value-added compounds, such as natural product Komavine.