Recently, the rhodium(III)-complex [Cp*RhCl2](2) 1 has provided exciting opportunities for the efficient synthesis of aromatic heterocycles based on a rhodium-catalyzed C H bond functionalization event. In the present report, the use of complexes 1 and its dicationic analogue [Cp*Rh(MeCN)(3)][SbF6](2) 2 have been employed in the formation of indoles via the oxidative annulation of acetanilides with internal alkynes. The optimized reaction conditions allow for molecular oxygen to be used as the terminal oxidant in this process, and the reaction may be carried out under mild temperatures (60 degrees C). These conditions have resulted in an expanded compatibility of the reaction to include a range of new internal alkynes bearing synthetically useful functional groups in moderate to excellent yields. The applicability of the method is exemplified in an efficient synthesis of paullone 3, a tetracyclic indole derivative with established biological activity. A mechanistic investigation of the reaction, employing deuterium labeling experiments and kinetic analysis, has provided insight into issues of reactivity for both coupling partners as well as aided in the development of conditions for improved regioselectivity with respect to meta-substituted acetanilides. This reaction class has also been extended to include the synthesis of pyrroles. Catalyst 2 efficiently couples substituted enamides with internal alkynes at room temperature to form trisubstituted pyrroles in good to excellent yields. The high functional group compatibility of this reaction enables the elaboration of the pyrrole products into a variety of differentially substituted pyrroles.