2-Diazo-1,2-naphthoquinone (1) and its derivatives are the photoactive components in Novolak photoresists. A femtosecond infrared study has established that the photoreaction of 1 proceeds largely by a concerted Wolff rearrangement yielding the ketene 1H-inden-1-ylidene-methanone (3) within 300 fs after excitation, but earlier trapping studies gave evidence for a minor reaction path via a carbene intermediate 1-oxo-2(1H)-naphthalenylidene (2) with a lifetime of about 10 ps. Here, we provide a quantitative assessment of the stepwise pathway by Stern-Volmer analysis of the trapping of 2 by methanol to yield 2-methoxy-1-naphthol (4). We conclude that the lifetime of the carbene 2 is at least 200 ps. Moreover, [3 + 2]cycloaddition of 2 and acetonitrile yielding 2-methylnaphth[2,1-d]oxazole (5) was observed. A comparison of the yields of 5 formed upon photolysis and upon thermolysis of 1 in acetonitrile provides evidence that a substantial part of the hot nascent carbene 2 formed photolytically rearranges to the ketene 3 during its vibrational relaxation (hot ground-state reaction).