We report the [Ru(p-cymene)(l-proline)Cl] ([Ru1])-catalyzed cyclization of 1,4,2-dioxazol-5-ones to form dihydroquinoline-2-ones in excellent yields with excellent regioselectivity via a formal intramolecular arene C(sp2)-H amidation. The reactions of the 2- and 4-substituted aryl dioxazolones proceeds initially through spirolactamization via electrophilic amidation at the arene site, which is para or ortho to the substituent. A Hammett correlation study showed that the spirolactamization is likely to occur by electrophilic nitrenoid attack at the arene, which is characterized by a negative ρ value of -0.73.