In the present study, we report the palladium(II)-catalyzed regioselective ortho-C–H bromination/iodination of challenging arylacetamide derivatives using N-halosuccinimides as halogenating agents. Diverse arylacetamides underwent the regioselective ortho-bromination and iodination of aromatic C–H bonds in the presence of a reactive benzylic C(sp³)–H bond without installing any bulky auxiliaries via unfavorable six-membered metallacycles. Weak coordination, the use of ubiquitous primary amides for challenging C–H functionalization, the simple catalytic system and the wide substrate scope are the key features of this transformation. Further, the halogenated amide derivatives were transformed into a variety of valuable synthons. Detailed mechanistic studies revealed some interesting aspects concerning the reaction pathway. We present for the first time strong evidence for the formation of imidic acid (in situ) from primary amides under Brønsted acid conditions that eventually aids in the stabilization of palladacycles of amide derivatives and drives regioselective C–X bond formation.