An efficient synthesis of functionalized 3-alkyl-3-cyanomethyl-2-oxindole by a palladium-catalyzed domino Heck-cyanation reaction has been developed. Reaction of ortho-iodoanilide with potassium ferro(II)cyanide in the presence of palladium acetate and sodium carbonate afforded oxindole derivs., e.g., I, in good to excellent yields. An enantioselective domino Heck-cyanation process has been developed for the first time using (S)-DIFLUORPHOS as a chiral supporting ligand, and an enantioselectivity of up to 79% ee in the enantiomerically enriched oxindole was obtained under optimized conditions. A concise total synthesis of (+-)-esermethole (II, R = Me) and (+-)-physostigmine (II, R = CONHMe), powerful inhibitors of acetyl- and butyryl-cholinesterase, is also described. [on SciFinder (R)]