AbstractSeven new pyridinium dichlorophosphinomethylides 2 have been obtained from dichlorophosphinylation of the pyridinium methylides generated in situ. 2 give 1,3‐bis(alkoxycarbonyl)‐2‐phosphaindolizines 4 through 1,5‐electrocyclization of the intermediate, bis(pyridinium ylidyl)phosphenium chloride 3 which is generated either from disproportionation of 2 or from the reaction of 2 with pyridinium methylide. Formation of 3 has been confirmed by carrying out a crossed reaction. 3‐Substituted 2 forms 4 regiospecifically. Intramolecular 1,5‐cyclocondensation of 2‐methylpyridinium dichlorophosphinomethylide is preferred over its disproportionation. © 2001 John Wiley & Sons, Inc. Heteroatom Chem 12:602–609, 2001