Ethyl acylindole-2-carboxylates were treated with thallium trinitrate (TTN) in methanol, methyl orthoformate, methyl orthoformate/sulfuric acid, and acetic acid. The reactions in the former three methanolic solvents gave methyl indoleacetate derivatives via the Favorskii-type rearrangement reaction at the acyl group, whereas the reaction in acetic acid gave oxindole derivative with rearrangement of the C2-ethoxycarbonyl group. The TTN reaction was applied to a model compound leading to the synthesis of lysergic acid.