An efficient water-based bismuth-mediated addition reaction of carbonyl compound with cyclic allylic halide was developed. The reactions proceeded smoothly in aqueous DMF in the presence of ammonium iodide to afford the corresponding syn-homoallylic alcohols in moderate to good yields with excellent diastereoselectivities (>99:1 syn:anti). Reversal of product diastereoselectivity was observed when heteroaryl aldehyde possessing an adjacent chelating nitrogen atom was employed as substrate.