The rhodium acetate catalyzed reaction of D-glucose-derived delta-amino alpha-diazo beta-ketoester allows a stereoselective beta-facial intramolecular N-H insertion reaction that leads to formation of the bicyclic pyrrolidinone ring skeleton in high yield. The sugar-substituted pyrrolidinone thus obtained was elaborated to allow the synthesis of promising glycosidase inhibitors, namely, 2,5-dideoxy2,5-imino-L-glycero-alpha-D-galactoheptitol and 2,5-dideoxy-2,5-imino-D-galactitol.