Iodomethylboron compounds, either the trifluoroborate or a boronic ester, cyclopropanate electron-rich olefins and unprotected allylic alcohols with Pd catalysts according to a novel, designed catalytic cycle. Proposed intermediates in a "diverted Heck" mechanism are observed by means of spectroscopic studies and by isolation and X-ray crystallographic characterization, which together with reaction kinetics point to a separation of rate-determining and product-determining steps, and a mechanism-based optimization of the yield, selectivity, and scope of the catalytic electrophilic cyclopropanation. The reaction with crystalline, air-stable, nonhygroscopic, and nontoxic reagents provides an alternative to Simmons−Smith-type reactions, as well as cyclopropanation procedures that require the use of diazomethane.