4-Anilino-5-(2'-substituted phenoxy/thiophenoxy) phenacylmercapto-3-substituted-1, 2, 4-triazole (5, X = O, S) have been prepared by the interaction of 4-anilino-5-mercapto-3-substituted-1, 2, 4-triazole with 2-bromo-2-substituted phenoxy/thiophenoxy acetophenones (2, X = O, S), which upon bromination followed by cyclisation afforded 3-substituted-5-phenyl-6-substituted benzoyl-6-substituted-phenoxy/thiophenoxy-1, 2, 4-triazolo[3, 4-b][1, 3, 4]thiadiazolidines (7X = O, S). Alternative unambiguous synthesis of 7 has also been described.