In this study, the mechanism and stereoselectivity in the B(C6F5)3-catalyzed cyclopropanation of styrenes and aryldiazoacetates were studied by the density functional theory (DFT), revealing a number of important observations. (1) The whole reaction entails the coordination of B(C6F5)3 to the Lewis basic ester site on diazo compound, generating an alkene diazonium species. Loss of dinitrogen affords a resonance stabilized Lewis acid-activated carbene intermediate, which then undergoes a concerted [2 + 1] cycloaddition with styrene to yield a S-isomeric product and regenerate the catalyst. (2) Additional calculation results for E/Z-β-methyl styrene and allyl 4-bromophenyldiazoacetate also support the concerted pathway. (3) For tosylvinylindole substrate, the reaction tends to produce a cyclopropane of the olefin rather than the C[sbnd]H insertion product or cyclopropanation of the 2,3-bond of the indole unit. (4) The calculation results for three ineffective diazo substrates indicate that the activation free energy for the formation of Lewis acid-activated carbene is too high to conduct further reaction. In addition, the distortion/interaction analysis showed that the chemoselectivity of cyclopropanation (C1 or C2) and C[sbnd]H functionalization were entirely determined by the distortion energy, while the stereoselectivity is influenced by the interaction and distortion energies. The obtained results can be of particular significance in homogeneous catalysis toward the design and prediction of organocatalytic molecular systems and [2 + 1] cycloaddition transformations involving alkenes and diazo derivatives. © 2021 Elsevier B.V.