A new method for the direct and stereoselective synthesis of 3-substituted isoindolinones via Rh(III)-catalyzed chiral N-sulfinyl amide directed asymmetric [4 + 1] annulation of benzamides with acrylic esters has been developed. The reaction proceeded through an oxidative C–H olefination and a subsequent cyclization by intramolecular aza-Michael addition, producing a series of diastereoisomeric chiral isoindolinones (20 examples) in generally good yields with a dr value up to 5.5 : 1. The absolute configurations of the newly formed C-stereocenters in the major and minor diastereomers of the catalysis product have been determined by X-ray crystal diffraction analysis to be S and R, respectively. The separation of the major diastereoisomers from the catalysis products and subsequent removal of the N-sulfinyl chiral auxiliary afforded enantiomerically pure (S)-isoindolinones. The application of the obtained (S)-isoindolinones in the synthesis of several biologically active isoindolinones such as (S)-PD172938, (S)-pazinaclone and (S)-pagoclone is presented.