Panic and related anxiety disorders are common psychiatric disorders. Both genetic and environmental factors appear to contribute to their development. Multiple brain regions including the amygdala, hippocampus, and frontal cortex, as well as associated neurotransmitter and neuroendocrine systems have been implicated in the development of these disorders. Early life stressors such as maternal separation, inflammation, and infection also appear to play important roles. This review will discuss recent animal and human studies that are beginning to elucidate the neurodevelopmental mechanisms of panic and anxiety disorders.