The cooperative catalysis by palladium and triphenylborane effects the intramolecular oxycyanation of alkenes through the cleavage of O-CN bonds and the subsequent insertion of double bonds. The use of 4,5-bis(diphenylphosphino)-9,9-dimethylxanthene (Xantphos) as a ligand for palladium is essential for allowing the transformation to proceed with high chemo- and regioselectivity. Variously substituted dihydrobenzofurans with both a tetra-substituted carbon and cyano functionality are accessed by the newly developed methodology.