This paper critically examines the pharmacological provocation and treatment of panic disorder. An analysis of research findings on how panic attacks are induced indicates that there are psychological and non specific factors that may mediate biochemical etiological models, and these individual differences need to be investigated further. This has important implications for the psychopharmacological management of panic. A review of studies on treating panic disorder with imipramine and alprazolam emphasizes the importance of several non specific factors that include the role of self-directed in vivo exposure and changes in dysphoria and self-efficacy (subjective beliefs regarding personal compentency) in predicting outcome. It is recommended that any treatment of panic-related disorders include self-directed, in vivo exposure.