Intramolecular cyclization of 3-hydroxy acids was investigated using iodine as a catalyst under solvent-free conditions. The reaction proceeded to completion in the heterogeneous system. Lactones were obtained by intramolecular cyclization of 3-hydroxy acids. Propella lactone (11-oxatricyclo[4.4.3.0^1,6]tridecan-12-one) was conveniently synthesized from 3-hydroxy acid ((6-hydroxyspiro[4.5]dec-6-yl)acetic acid) in 88% yield with carbon skeleton rearrangement. Spiro lactones and bicyclic lactones were also obtained from the corresponding 3-hydroxy acids in yields of over 75%. The most suitable reaction conditions were a temperature of 80°C, a molar ratio of 3-hydroxy acid:iodine = 1:0.1, and a time period of 6 h. In addition, terpenic lactones were efficiently synthesized from the corresponding 3-hydroxy acids, derived from (+)-camphor, (-)-fencone, and (-)-pulegone, with skeleton rearrangement. The yield of the solvent-free reaction was as high as that of the corresponding reaction in solution.