The synthesis of heretofore unknown γ-spirobutenolides has been achieved via an m-CPBA-mediated oxidation of β-furyl amides. The reaction employs a tethered amide, ostensibly a poorly reactive carbonyl, as a nontraditional nucleophile resulting in spirolactone formation and concurrent amide cleavage. The transformation exhibits functional group tolerance and compatibility with complex compounds. In situ 1H NMR spectroscopic studies reveal the identities of key intermediates in the oxidation-spirolactonization-oxidation cascade, suggesting a plausible mechanistic pathway. The distinct diastereofaces of the electrophilic butenolide product may be used for diastereoselective cycloaddition and conjugate addition reactions.