Although abnormalities in brain structures involved in the neurobiology of fear and anxiety have been implicated in the pathophysiology of panic disorder (PD), relatively few studies have made use of voxel-based morphometry (VBM) magnetic resonance imaging (MRI) to determine structural brain abnormalities in PD. We have assessed gray matter volume in 19 PD patients and 20 healthy volunteers using VBM. Images were acquired using a 1.5 T MRI scanner, and were spatially normalized and segmented using optimized VBM. Statistical comparisons were performed using the general linear model. A relative increase in gray matter volume was found in the left insula of PD patients compared with controls. Additional structures showing differential increases were the left superior temporal gyrus, the midbrain, and the pons. A relative gray matter deficit was found in the right anterior cingulate cortex. The insula and anterior cingulate abnormalities may be relevant to the pathophysiology of PD, since these structures participate in the evaluation process that ascribes negative emotional meaning to potentially distressing cognitive and interoceptive sensory information. The abnormal brain stem structures may be involved in the generation of panic attacks.