An external-oxidant-free process to access the isoquinolone motif via cross-coupling/cyclization of benzhydroxamic acid with alkynes is described. The reaction features a regioselective cleavage of a C-H bond on the benzhydroxamic acid coupling partner as well as a regioselective alkyne insertion. Mechanistic studies point out the important involvement of a N-O bond as a tool for C-N bond formation and catalyst turnover.