There is a growing interest in the design and construction of a PET scanner with a very long axial extent. One critical design challenge is the impact of the long axial extent on the scanner spatial resolution properties. In this work, we characterize the effect of parallax error in PET system designs having an axial field-of-view (FOV) of 198 cm (total-body PET scanner) using fully-3D Monte Carlo simulations. Two different scintillation materials were studied: LSO and LaBr3. The crystal size in both cases was 4 × 4 × 20 mm3. Several different depth-of-interaction (DOI) encoding techniques were investigated to characterize the improvement in spatial resolution when using a DOI capable detector. To measure spatial resolution we simulated point sources in a warm background in the center of the imaging FOV, where the effects of axial parallax are largest, and at several positions radially offset from the center. Using a line-of-response based ordered-subset expectation maximization reconstruction algorithm we found that the axial resolution in an LSO scanner degrades from 4.8 mm to 5.7 mm (full width at half max) at the center of the imaging FOV when extending the axial acceptance angle (α) from ±12° (corresponding to an axial FOV of 18 cm) to the maximum of ±67°—a similar result was obtained with LaBr3, in which the axial resolution degraded from 5.3 mm to 6.1 mm. For comparison we also measured the degradation due to radial parallax error in the transverse imaging FOV; the transverse resolution, averaging radial and tangential directions, of an LSO scanner was degraded from 4.9 mm to 7.7 mm, for a measurement at the center of the scanner compared to a measurement with a radial offset of 23 cm. Simulations of a DOI detector design improved the spatial resolution in all dimensions. The axial resolution in the LSO-based scanner, with α = ± 67°, was improved from 5.7 mm to 5.0 mm by incorporating a two-layer DOI detector. These results characterize the maximum axial blurring for a fully open 2 m long PET scanner and demonstrate that large sensitivity gains are possible with a modest reduction in resolution when using current clinical detector technology with no DOI capability.