The reaction of N-hydroxyacetoacetanilide derivatives (1a-g) with hydroxylamine in aqueous ethanol gave 3-methyl-4-arylhydrazono-5-isoxazolones (3a-g). When ethanol or chloroform was used as the reaction medium, the reaction of N-hydroxyacetoacetanilide (1a) with carbonyl reagents gave N-phenylhydroxylamine derivatives and five-membered heterocycles such as 3-methyl-5-isoxazolone or 3-methyl-5-pyrazolone derivatives. The mechanism of the formation of these products is discussed.