A highly diastereoselective synthesis of (2S,3S)-β-hydroxy-α-amino acids has been developed from enantiopure α-hydroxy acids using a MOM-ether-directed, palladium(II)-catalysed, aza-Claisen rearrangement of allylic acetimidates to effect the key step. This highly stereoselective process gave allylic amides in diastereomeric ratios of up to 14 : 1. Problems associated with the isolation of 1,3-products (anti-Claisen) from sterically demanding substrates via an insitu palladium(0)-catalysed rearrangement process were overcome by the addition of a re-oxidant, p-benzoquinone, leading to cleaner reactions and improved yields of the 3,3-products (Claisen). The target β-hydroxy-α-amino acids are an important class of natural products that are also components of more complex organic compounds with significant biological properties.