Panic has not always been recognised as an exclusively psychiatric condition. Research in this area continued along separate medical and psychological axes until 1980, when the development of Diagnostic and Statistical Manual (DSM)-III criteria established the overall concept of panic disorder. The lifetime prevalence of DSM-III panic disorder and repeated panic attacks, defined as the average of individual estimates from six studies, are 2.7% and 7.1% of the general population, respectively. Females are almost twice as likely as males to suffer panic disorder, and about seven times as likely to suffer repeated panic attacks. Overall, panic disorder or panic attacks occur in up to one in ten of the general population. The prevalence of panic disorder and panic attacks, their associations with other conditions, and their time courses have been investigated in a prospective epidemiological study in Zurich, Switzerland, in which 591 individuals were followed for 15 years. The validity of panic disorder and panic attacks as genuine psychological phenomena are attested to by their positive associations with a family history of panic disorder, elevated risk of suicide, lifetime treatment for psychiatric disorders, and especially treatment with prescribed medication and substantial work and social impairment. Strong comorbidity exists between panic states and other psychiatric conditions, including depression (major depression, bipolar disorder and recurrent brief depression), agoraphobia, social phobia, specific phobia, and obsessive-compulsive disease. A lower degree of comorbidity is seen with alcohol and tobacco dependence. Comorbid conditions usually precede panic, except for alcohol abuse, which is usually secondary to episodes of panic. The prognosis of panic states is often optimistic, and chronic disease is present in less than half of sufferers. Both panic disorder and repeated panic attacks are common, serious and disabling conditions. Effective diagnosis and treatment of repeated panic attacks and panic disorder are of equal importance.