A process for the preparation of 3,4-dihydroxybutanoic acid (I) and 3-hydroxy-.gamma.-butyrolactone (V) thereof from a 3-leaving group substituted pentose source is described. In particular, the process relates to the synthesis of (R)-3,4-dihydroxybutanoic acid and (R)-3-hydroxy-.gamma.-butyrolactone from a 3-leaving group substituted L-pentose sugars. The process uses a base and a peroxide to convert the pentose source to the chiral 3,4-dihydroxybutanoic acid compound. The chiral 3,4-dihydroxybutanoic acid can be further converted to 3-hydroxy-.gamma.-butyrolactone by acidification. The chiral compound is useful as a chemical intermediate to the synthesis of various drugs and other products.