A method for the construction of cyclophane-braced peptide macrocycles via Pd-catalyzed aminoquinoline-directed intramolecular C(sp3)-H arylation with aryl iodides is developed. Unlike our previous AQ-directed exo-type intramolecular C-H arylation of long alkyl tails, this endo-type C-H cyclization reaction takes places on the β-methyl group of N-methyl alanine at the C-termini of peptides. Unusual C-N cleavage side products of Ala were observed and attributed to intramolecular deprotonation-assisted α,β-elimination of the palladacycle intermediate.