Cp*Co(III)-catalysed selective alkylation of directed C–H bonds of arenes and heteroarenes has been accomplished employing donor–acceptor carbenes, derived from α-diazocarbonyl compounds. The developed method allows ready access to various substituted α-(hetero)aryl-α-arylacetic acid derivatives in good to excellent yields. Synthetic utility was also shown through the synthesis of a substituted indole derivative, an anticancer agent.