This article reports on the course of uncomplicated panic disorder and panic with agoraphobia on 309 patients participating in the Harvard/Brown Anxiety Research Project, a prospective longitudinal study of patients with DSM-III-R-defined anxiety disorders. At 1 year, there was a .39 probability of full remission for uncomplicated panic disorder and a .17 probability of full remission for panic disorder with agoraphobia. Similar differences in time to remission for these syndromes were still found when criteria for remission were made less stringent. However, even requiring less improvement for remission left a large percentage of subjects in an episode, and for those that remitted, relapse occurred quickly, indicating a chronic and recurrent course of illness. This is the first longitudinal, prospective, naturalistic study on a large cohort of subjects with anxiety disorders to have regular, structured, short-interval follow-up. Our results are consistent with the view that panic disorder has a chronic course with high rates of relapse after remission and longer episodes when agoraphobia is a part of the constellation of symptoms.