In this paper, Rh2(OAc)4-catalyzed [2,3]-sigmatropic rearrangement of sulfur ylides derived from N-tosylhydrazones and sulfides is reported. A series of tosylhydrazones derived from aldehydes were successfully used for [2,3]-sigmatropic rearrangement by reaction with either allylic phenyl sulfides or propargyl phenyl sulfides. The reaction conditions were optimized and afforded the products in moderate to good yields. In addition, a novel and convenient approach for the synthesis of cyclobutenones and cyclopropanes has been developed through direct oxidation of the rearrangement products.