DFT calculations have been combined with experiments to study the mechanism of γ-C­(sp3)–H arylation of aliphatic amines promoted by palladium–glyoxylic acid cooperative catalysis, with a focus on the role of silver­(I) additives. Glyoxylic acid (the cocatalyst) uses its aldehyde functionality to react with the amine substrate to form an iminoacetic acid. This acid acts as a transient directing reagent and metathesizes with Pd­(OAc)2 (the precatalyst) to give a Pd­(II)–diiminoacetate five-membered chelate, which has been shown computationally as the catalyst resting state and which has been experimentally synthesized and characterized. C­(sp3)–H activation from the Pd­(II)–diiminoacetate complex or its mononuclear derivatives would face a high kinetic barrier (>30 kcal/mol) arising mainly from breaking a stable five-membered N,O-chelate ring. The crucial role of the silver­(I) carboxylate additive is in reacting with the Pd­(II)–diiminoacetate complex to provide a heterodimeric Pd­(II)–Ag­(I) complex supported by bridging chelators and intermetallic Pd–Ag interaction, which would lead to a C­(sp3)–H activation transition state with a considerably lower barrier (∼25 kcal/mol). The Pd­(II)–Ag­(I) complex has been detected by mass spectrometry, which provides the first experimental evidence of a Pd–Ag-containing active species in Pd-catalyzed C–H activation reactions using Ag­(I) additives. After C­(sp3)–H activation, the reaction proceeds through oxidative addition of Pd­(II) and reductive elimination from Pd­(IV) completing C–C formation, followed by ligand exchange to regenerate the catalyst resting state and release the arylated iminoacetic acid which continues on hydrolysis to give the final amine product and regenerate the glyoxylic acid cocatalyst. The computational and experimental findings taken together provide new mechanistic insight into the broad range of palladium-catalyzed C–H activation reactions that use silver­(I) additives.