A novel silver-catalyzed ring-opening acylation of cyclopropanols and cyclobutanols is described. The reaction proceeds under mild and neutral conditions and provides a facile access to nonsymmetric 1,4- and 1,5-diketones in promising yields with broad substrate scope. Mechanistic studies including DFT calculations suggest the involvement of an uncommon water-assisted 1,2-HAT process, which is strongly exothermic and thus promotes addition of carbon radicals to aldehydes. In contrast to traditional reductive radical addition protocols, this work represents the first example of the intermolecular oxidative radical addition to aldehydes, thus offering a novel strategy for the direct synthesis of acyclic ketones from readily accessible aldehydes.