Following a convenient sequence of alkylation and amination of 3,4-diisopropoxycyclobutene-1,2-dione 11, three typical substituted groups (H, n-Bu, and Ph) and three typical amino groups (unsubstituted, primary and secondary) are easily introduced onto its C-3 and C-4 positions, respectively, to yield 4-substituted 3-aminocyclobutene-1,2-diones 14. Reduction of compounds 14 with NaBH₄ yield 2-substituted 3-amino-4-hydroxycyclobutenones 15 in high yields. By ring transformation of products 15 catalyzed by TFA, a simple and general route for the preparation of 3-substituted 4-aminofuran-2(5H)-ones 4 is developed. A two-step mechanism is proposed to describe the ring transformation of enones 15. The experimental results show that the process in refluxing p-xylene is essential for the initial thermal electrocyclic opening of 15 to yield intermediate hydroxy ketenes 16a and 16b. They are then lactonized in the presence of TFA to give furanones 4 in 51–94% yield.