The oxidative addition of ethyl acetoacetate to indene mediated by cerium(IV) ammonium nitrate(CAN) leads to the formation of 2-(2'-indan-1'-one)3-oxobutanoic acid ethyl ester 7 along with two other products, the dihydrofuran 9 and the methyl ester 10. Similar addition of dimethyl malonate to indene gives the indanone 11 and the methyl ether 12. A tentative mechanism which rationalizes the formation of these products is proposed.