The reactions of ethylenethioglycolate with 3-chlorobicyclobutanecarbonitrile in MeOH and dimethoxyethane (DME) were studied. The reaction in MeOH involves nucleophilic attack followed by solvolysis of the a-chloro thioether moiety to give the ionic bicyclobutane. The latter undergoes mainly internal trapping of the carbenium ion to give the spiro derivative 8 along with addition products of MeOH (9) and a second nucleophile molecule (10). Addition of HOCH2CH2SH to the reaction mixture inhibits the formation of the spiro derivative indicating that the reaction of O- and not OH is involved in the cyclization process. The effective molarity of O- in the cyclization reaction is estimated to be 66. In DME, the reactions were heterogenous. Substitution of Cl by HOCH2CH2S in a nucleophilic addition-elimination mechanism gave the corresponding bicyclobutane derivative. This reacted further to give the spiro compound by an ionic chain mechanism.