A Ru(II) complex with a hydrophobic cavity formed from two 1-naphthoylamide groups was prepared. Its reactions with beta-diketones gave beta-diketonato complexes in which hydrophobic pi-pi or CH/pi interactions were confirmed by NMR spectroscopy and X-ray crystallography. In the case of the asymmetric beta-diketone benzoylacetone, an isomer with a CH/pi interaction was afforded as the sole product owing to thermodynamic control. The reaction was found to involve a novel intramolecular rearrangement from the phenyl-included isomer to the methyl-included one without rupture of Ru-beta-diketonato coordination bonds (activation energy 52 kJ mol(-1)). This indicates that CH/pi interactions can be more favored thermodynamically than pi-pi interactions in a suitable hydrophobic environment.