An iron-catalysed carbene transfer reaction of diazo compounds to isocyanides has been developed. The resulting ketenimines are trapped in situ with various bisnucleophiles to access a range of densely functionalized heterocycles (pyrimidinones, dihydropyrazolones, 1H-tetrazoles) in a one-pot process. The electron-rich Hieber anion ([Fe(CO)3 NO]- ) facilitates efficient catalytic carbene transfer from acceptor-type α-diazo carbonyl compounds to isocyanides, providing a cost-efficient and benign alternative to similar noble metal-catalysed processes. Based on DFT calculations a plausible reaction mechanism for activation of the α-diazo carbonyl carbene precursor and ketenimine formation is provided.