The aza-Clasen rearrangement of N-aryl-2-vinylazetidines has been explored. N-Aryl-2-vinylazetidines were transformed to corresponding tetrahydrobenzazocines in good yields. Unexpectedly, the tetrahydrobenzazocine was unstable and readily isomerized to vinyltetrahydroquinoline in the presence of acid. The mechanism of this ring contraction was studied in detail.