A set of dispiro[indoline-3,2′-pyrrolidine-3′,3′′-pyrrolidines] 8a–l was regioselectively synthesized utilizing multi-component azomethine cycloaddition reaction of 3-(arylmethylidene)pyrrolidine-2,5-diones 5a–e, isatins 6a–c and sarcosine 7. Single crystal X-ray studies of 8c add conclusive support for the structure. Compounds 8e and 8g reveal cholinesterase inhibitory properties with promising efficacy against both AChE and BChE and were found to be more selective towards AChE than BChE as indicted by the selectivity index like Donepezil (a clinically used cholinesterase inhibitory drug). Molecular modeling studies assist in understanding the bio-observations and identifying the responsible parameters behind biological properties.