An efficient Ir(III)-catalyzed decarbonylative annulation of salicylaldehydes with cyclohexane-1,3-diones has been achieved via the in situ generated iodonium ylides. The reaction proceeds smoothly under mild and operationally simple conditions, affording a variety of benzofuran derivatives in moderate to high yields with good functional group tolerance. Moreover, the large-scale synthesis and further modification of the products highlight the utility of this protocol.