The Lewis acid-promoted reactions of benzylic azides with ketones can proceed by two major pathways. The azido-Schmidt reaction involves simple addition of azide to the ketone followed by rearrangement and ring expansion. In addition, benzylic azides can undergo prior rearrangement to afford iminium ions that can subsequently participate in a Mannich reaction. A series of ketones containing an alpha CH2(CH2)nCH(N3)Ph substituent (n = 1-3) was prepared to investigate the dependence of products on ketone ring size and tether length. For all ketones examined, good yields of bicyclic lactams arising from intramolecular Schmidt reaction were obtained when a four-carbon linker was used (n = 1 in the above formulation), but Mannich products predominated for the longer tethers examined (n = 2, 3).