The acid-catalyzed hydrolysis of the cyclic diazothiolactone, 4-diazoisochroman-3-one (3) was found to occur with the hydronium-ion isotope effect,and to give the ring-contracted product, 1,3-dihydrobenzo[c]thiophene-1-carboxylic acid (4). This shows that protonation of the diazo carbon atom occurs in the rate-determining step and that the reaction also involves migration of the thio group. The hydronium-ion catalytic coefficient for this reaction,, is 45 times less than that for hydrolysis of its acyclic thio ester analog,S-methyl phenyldiazothioacetate (5). Semiempirical AM1 molecular orbital calculations support the idea that this difference in reactivity is the result of increased delocalization of negative charge into the aromatic ring in the case of the cyclic substrate, which reduces the negative charge on the diazo carbon atom and makes it less susceptible to protonation.Key words: hydrolysis, diazoalkanes, charge delocalization, AM1 calculations, thio group migration.