Indeed, off-loop catalyst dormancy and deactivation are two frequently encountered issues in catalysis and can cause a tremendous loss of catalytic efficiency in catalytic process development if not properly addressed. Herein we report the development of a homeostatic catalysis approach to combat these off-loop challenges. Homeostasis is a Nature's way of self-regulation that allows a biological system to maintain functional activity even in a hostile external environment. One mechanism to achieve such a highly effective performance is through the localization of a dynamic and reversible chemical equilibrium process on a dedicated response unit so that no unintended, irreversible damage is inflicted upon the whole system. The homeostatic catalysis concept described herein recapitulates these mechanistic features and refers to a catalytic process that can sustain its productive catalytic cycle even when chemically disturbed. In particular, cobalt homeostatic catalysis permits the water-tolerant coupling of enaminones and oxadiazolones to quinazolinones. The adventitious inclusion of water into a catalytic system is practically unavoidable, given its ubiquitous presence in solvents, and has proven to be a major cause of catalyst deactivation in many different scenarios (Scheme 1a). For example, in heterogeneous catalysis, water can directly adsorb to the catalyst surface and block the active site or induce activityabolishing catalyst oxidation and sintering (Fischer-Tropsch catalyst); hydrolytic ligand degradation and hydrolytic coordinate bond breakage (Ziegler-Natta catalyst, first-and second-generation Grubbs catalysts) can both elicit the loss of catalytic activity. In our catalytic system (Scheme 1b), the highly labile Cα-N bond of enaminone (bearing a secondary amino group, either alone or when coordinated to cobalt) serves as the preferred buffering reactive site for water through dynamic covalent bonding-based nucleophilic exchange. This water-receptive reaction affords, initially, an off-loop, dormant cobalt enolate chelate of β-keto aldehyde and releases a secondary amine. However, the dynamic covalent bonding nature of the substitution enables the reversion of the reaction and the exchange back of hydroxyl group by the secondary amine, thus allowing its efficient on-loop re-entry back into the productive catalytic cycle. The expedient, precision dynamic covalent bonding exchange process provides a homeostatic catalysis mechanistic basis for preventing water from reacting elsewhere and exerting a deleterious, or even deactivating effect on the catalytic cycle.