Herein, we report a protocol for the selective δ‐thiolation of aliphatic α‐amino acids catalyzed by a Pd(II)/Ag system. This reaction employs disulfides as thiolating agents and N‐COPy as directing group, providing valuable non‐proteinogenic amino acid derivatives in moderate to good diastereoselectivities and yields. Remarkably, the method is also suitable for the late‐stage functionalization of a dipeptide. Experimental and DFT studies have provided significant insights into the mechanism and underlying factors controlling the selectivity of the process and determining the key role of the silver salt.