This is the first report on the use of the sustained release formulation of adinazolam in the treatment of panic disorder. A six week open lable trial followed by a 1-6 week taper/discontinuation phase was used to assess the safety and efficacy of adinazolam (Deracyn-SR) in the treatment of 10 outpatients with panic disorder and agoraphobia. Adinazolam-SR was well tolerated and produced a rapid improvement in panic and limited symptom attacks, anxiety, phobias, disability, and depressive symptoms. Mean ±S.D. duration of therapeutic action of each dose of this formulation was 12.2±2.3 hours. This is longer than the duration of therapeutic action of other benzodiazepine formulations studied to date for the treatment of panic disorder. Frequency of relapse, rebound and withdrawal symptoms was similar to that found on taper/discontinuation from alprazolam.