Used as a key intermediate in the synthesis of pharmaceuticals and agrochemicals, particularly in the preparation of bioactive molecules containing phthalimide derivatives. It serves as a protected form of amine in peptide synthesis and heterocyclic compounds due to the stability of the phthalimide group. Its acetyl functionality allows for further chemical modifications, making it valuable in organic synthesis for introducing functionalized side chains. Also employed in the development of dyes and fluorescent probes owing to the aromatic and electron-withdrawing nature of the isoindoline core.