The direct amidation of C−H bonds to obtain nitrogen-containing heterocycles is a highly desirable reaction, because it will open the door to many new applications in chemical synthesis. Although tremendous progress has been made, our current ability to prepare heterocycles via such direct C−H functionalization is limited. Here we present a novel methodology that employs Ir-based catalysts and dioxazolone substrates to access short-lived Ir-nitrenoid complexes, which are key intermediates in the efficient construction of γ-lactams through direct C−H bond amidation. Stoichiometric studies with robust carbonylnitrene precursor, 1,4,2-dioxazol-5-ones, suggest that the insertion of C−H into metal-nitrenoid moiety is possible and mechanistic clues from the initial proof-of-concept studies further enabled the design of efficient and versatile catalysts that allows for the straightforward amidations of various sp³- and sp² C−H bonds with exceptional selectivity leading to lactam products. The power of this new method is demonstrated in the successful late-stage functionalization of bio-active molecules with amino acid derivatives to produce molecules that are highly sought after for pharmaceutical and other applications in synthesis.