A Rh(III)-catalyzed tandem C(sp²)–H allylation/N-alkylation annulation reaction of arene amides employing 5-methylene-1,3-dioxan-2-one as an efficient allyl source has been disclosed for the first time, affording an unprecedented opportunity for the synthesis of 3,4-dihydropyrimido[1,6-a]indol-1(2H)-ones in moderate to excellent yields. Meanwhile, Rh(III)-catalyzed C(sp²)–H allylation products can also be obtained under altered reaction conditions. These practical and scalable divergent synthesis protocols proceeded smoothly under mild reaction conditions. Broad substrate scope, good functional group compatibility and total 32 examples were observed. Moreover, the preliminary mechanism studies show that the rhodium catalyst plays a dual role in the C–H activation and N-alkylation annulation process.