An efficient combination between the Passerini three-component reaction and aldol condensation has been developed for the synthesis of bicyclic isocoumarins with different substituted patterns via solvent-dependent domino pathways. These two operationally friendly methods simultaneously install C-O and C-C bonds in a one-pot manner, allowing the utilization of low-cost and readily accessible 2-formylbenzoic acid, isocyanides, and arylglyoxals. Mechanisms of formation of different substituted isocoumarin derivatives are also proposed.