Reactions between acyclic (E)-allylic acetates and arylboronic acids in the presence of a palladium catalyst prepared from Pd(OAc)(2), phenanthroline (or bipyridine), and AgSbF(6) (1:1.2:1) proceeded with excellent gamma-selectivity to afford allyl-aryl coupling products with E-configuration. The reactions of alpha-chiral allylic acetates took place with excellent alpha-to-gamma chirality transfer with syn stereochemistry to give allylated arenes with a stereogenic center at the benzylic position. The reaction tolerated a broad range of functional groups in both the allylic acetates and the arylboronic acids. Furthermore, gamma-arylation of cinnamyl alcohol derivatives afforded gem-diarylalkane derivatives containing an unconjugated alkenic substituent. The synthetic utility of this method was demonstrated by its utilization in an efficient synthesis of (+)-sertraline, an antidepressant agent. The observed gamma-regioselectivity and E-1,3-syn stereochemistry were rationalized based on a Pd(II) mechanism involving transmetalation between a cationic mono(acyloxo)palladium(II) complex and arylboronic acid, and directed carbopalladation followed by syn-beta-acyloxy elimination. The results of stoichiometric reactions of palladium complexes related to possible intermediates were fully consistent with the proposed mechanism.