Poly(urethane imide)s (PUIs) with improved thermal properties and flame retardancy can be made in a direct way by the reaction of isocyanates with anhydrides to give aromatic imides. We investigated the mechanism of this reaction in the presence of water with experimental studies and quantum chemical calculations. The catalytic cycle is driven by the urea obtained from the hydrolysis of isocyanates. We show that with a secondary amine as a pre-catalyst and tertiary amine as a co-catalyst, the reaction proceeds fast without a need for additional solvent. The insights in the underlying mechanism provided by the computational study have guided the development of a solvent-free synthetic method that provides a pathway to produce PUIs on an industrial scale.