Allylic hydroxy phosphonates and their derivatives can be interconverted by using cross metathesis with second generation Grubbs catalyst. The absolute stereochemistry of the starting phosphonate is conserved in the product. Cross metathesis reaction of the acrolein-derived phosphonate 2a yields a series of functionalized allylic hydroxy phosphonates. However, the cross metathesis reaction is often accompanied by competing dimerization and alkene migration reactions leading to a reduction in yield. The cinnamaldehyde- and crotonaldehyde-derived phosphonates 2b and 2c were also examined. In general, the metathesis reactions of phosphonates 2b and 2c are considerably slower than those for phosphonate 2a leading to mixtures. Several hydroxyl-protected derivatives of the phosphonate 2a (methyl carbonate 3a, acetate 4a, N-tosyl carbamate 5a, TBDMS 6a, and acetoacetate 7a) undergo metathesis without competing side reactions to give substituted allylic phosphonates in good to excellent yield.