The phosphorus ylide ligand [Ph3P=C(CO2Me)C(=NPh)CO2Me] (L1) has been prepared and fully characterized by spectroscopic, crystallographic, and density functional theory (DFT) methods (B3LYP level). The reactivity of L1 toward several cationic Pd-II and Pt-II precursors, with two vacant coordination sites, has been studied. The reaction of [M(C boolean AND X)(THF)(2)]ClO4 with L-1(1:1 molar ratio) gives [M(C boolean AND X)(L1)] ClO4 [M = Pd, C boolean AND X) C6H4CH2NMe2 (1), S-C6H4C(H) MeNMe2 (2), CH2-8-C9H6N (3), C6H4-2-NC5H4 (4), o-CH2C6H4P(o-tol)(2) (6), eta(3)-C3H5 (7); M = Pt, C boolean AND X = o-CH2C6H4P(o-tol)(2) (5); M(C boolean AND X) = Pd(C6F5)(SC4H8) (8), PdCl2 (9)]. In complexes 1-9, the ligand L1 bonds systematically to the metal center through the iminic N and the carbonyl O of the stabilizing CO2Me group, as is evident from the NMR data and from the X-ray structure of 3. Ligand L1 can also be orthopalladated by reaction with Pd(OAc)(2) and LiCl, giving the dinuclear derivative [Pd(mu-Cl)(C6H4-2-PPh2=C(CO2Me)C(CO2Me)=NPh)](2) (10). The X-ray crystal structure of 10 is also reported. In none of the prepared complexes 1-10 was the C-alpha atom found to be bonded to the metal center. DFT calculations and Bader analysis were performed on ylide L1 and complex 9 and its congeners in order to assess the preference of the six-membered N, O metallacycle over the four-membered C, N and five-membered C, O rings. The presence of two stabilizing groups at the ylidic C causes a reduction of its bonding capabilities. The increasing strength of the Pd-C, Pd-O, and Pd-N bonds along with other subtle effects are responsible for the relative stabilities of the different bonding modes.