A carbon dioxide hypersensitivity theory of panic has been posited. We hypothesize more broadly that a physiologic misinterpretation by a suffocation monitor misfires an evolved suffocation alarm system. This produces sudden respiratory distress followed swiftly by a brief hyperventilation, panic, and the urge to flee. Carbon dioxide hypersensitivity is seen as due to the deranged suffocation alarm monitor. If other indicators of potential suffocation provoke panic this theoretical extension is supported. We broadly pursue this theory by examining Ondine's curse as the physiologic and pharmacologic converse of panic disorder, splitting panic in terms of symptomatology and challenge studies, reevaluating the role of hyperventilation, and reinterpreting the contagiousness of sighing and yawning, as well as mass hysteria. Further, the phenomena of panic during relaxation and sleep, late luteal phase dysphoric disorder, pregnancy, childbirth, pulmonary disease, separation anxiety, and treatment are used to test and illuminate the suffocation false alarm theory.