Panic disorder is becoming better recognised and understood as a chronic, debilitating but treatable condition. Drug treatment options shown by adequate research to be beneficial in this condition include mainly the benzodiazepine alprazolam, the tricyclic antidepressants (TCAs) imipramine and clomipramine, the monoamine oxidase inhibitor (MAOI) phenelzine, and the newer selective serotonin reuptake inhibitors (SSRIs) fluvoxamine and paroxetine. Alprazolam, although approved for use in panic disorder in the US and very widely used, is associated with a risk of dependence and withdrawal syndromes. Given that depression frequently occurs as a comorbid condition with panic disorder the use of antidepressants is a logical choice. Among the antidepressants, MAOIs are little-used in panic disorder, mainly because of their potential for precipitating hypertensive crises if tyramine is ingested. TCAs are widely used and are effective but they are associated with initial activation, or ‘jitteriness’, have a 4–6-week time lag before onset of beneficial effect and produce troublesome side effects in a high proportion of patients, particularly during long-term use. TCAs are also cardiotoxic in overdosage, and panic disorder patients with comorbid depression are at high risk of attempted suicide. Serotonin dysregulation has been implicated in the pathogenesis of anxiety disorders in general, and panic disorder in particular. Among the TCAs, those with an effect on serotonin reuptake are most effective in panic disorder. SSRIs are specifically active on serotonin reuptake and do not have anticholinergic effects or act on the noradrenergic system. There is a clear pharmacological rationale for believing that SSRIs should be as effective as TCAs in panic disorder and better tolerated. Accumulating clinical research evidence supports this hypothesis. Further comparative studies with standard agents and additional long-term studies to support the initial long-term data with paroxetine are needed to confirm SSRIs as drug treatment of choice in panic disorder.