2-Arylindazoles undergo a smooth cyclization with α-diazocarbonyl compounds in the presence of 3 mol% Cp*Ir(III) and 10 mol% AgSbF6 in methanol at 100 °C to produce the corresponding indazolo[2,3-a]quinoline derivatives in good yields. Whereas in the case of α–diazoimidamide, only the ortho-alkylated product was formed without further cyclization.