It has been found that Smiles rearrangement leading to N-p-chlorophenyl-6-β-hydroxyethylamino-4-phenyl-2 (1H)-pyridone (II) took place when 6-β-aminoethoxy-N-p-chlorophenyl-4-phenyl-2 (1H)-pyridone (III) was heated in acetic acid, and that the reaction of an N-substituted 6-chloro-4-phenyl-2 (1H)-pyridone (I) with ethylenediamine, 2-amino-ethanethiol or o-aminothiophenol gives condensed heterocyclic pyridones such as imidazopyridone (IV), thiazolopyridone (X) or benzothiazolopyridone (XV). This reaction is considered to proceed by ring transformation of an intermediate of the Smiles rearrangement. Some of these pyridone derivatives showed strong biological activities as analgesic and antiinflammatory agents.