Compounds with the benzisothiazol-3-one (BIT) skeleton perform excellently in the pharmaceutical field, although current synthetic methods remain limited in terms of synthetic efficiency. Herein, we report the catalytic intramolecular N–S bond formation for BITs from easily prepared disulfide precursors by an Fe(III) dithiolate through O₂ activation at 298 K. Interestingly, the catalytic performance is enhanced by substituting O₂ with a milder O-donor oxidant, ONMe₃. Catalytic oxygenation of PPh₃ to OPPh₃ can also proceed under similar conditions. In addition, the first anionic monosulfenato Fe(III) species, Fe(III)–S(O)R, is isolated with structural characterization from the reaction of Fe(III) thiolate and ONMe₃.