Samarium(II)-promoted cyclizations of N-acylated indolyl sulfinyl imines without electron-withdrawing groups at C-3 furnished tertiary carbinamines in good yield. Screening of the reaction conditions revealed that application of an excess of samarium diiodide in the presence of water and lithium bromide provided the cleanest reactions and the highest yields. The most striking observation during this investigation was the reductive detachment of the sulfur functional group, which most likely precedes the cyclization step. As consequence no enantioselectivity could be observed if enantiopure sulfinyl imines were employed. The mechanisms of the N−S cleavage and of the cyclization of the intermediate imines as well as the role of the additives are discussed. The presented method generates interesting polycyclic indoline derivatives; a cascade reaction involving an ethoxycarbonyl-substituted side-chain provided unique tetracyclic spiro-γ-lactams.