A cooperative Rh(II)/Pd(0) dual-catalysis strategy that enabled divergent reactions of α-diazo 1,3-dicarbonyl compounds with allylic carbonates involving ketene versus carbene intermediates is described. The efficient synthesis of α-quaternary allylated β-keto-esters was accomplished by the Rh(II)/Pd(0) dual-catalysis allylic alkylation of α-diazo 1,3-dicarbonyl compounds. Alternatively, an unprecedented (1+4) annulation of α-diazo 1,3-dicarbonyl compounds with 2-(hydroxymethyl)allyl carbonates via Rh(II)/Pd(0) dual catalysis was also successfully developed, affording a wide variety of α-quaternary tetrahydrofurans in good to high yields.