A PdI2/I2-catalyzed thiolation-annulation route of alkynes with azides and disulfides for the synthesis of 4-sulfenylisoquinolines is described. This route allows numerous 2-alkynylbenzyl azides to react with disulfides or 1,2-diphenyldiselane leading to the corresponding 4-chalcogen-substituted isoquinolines in moderate to good yields.