In the literature, psychological and biological theories of panic disorder are often regarded as mutually exclusive. The present article presents an integrative theory that explains how and why cognitive misinterpretations and "false threat alarms" leading to irrational fear and anxiety can arise from a neurobiological dysfunction in the amygdala and ascending transmitter systems. According to this view, physiological symptoms (such as palpitations and respiration manoeuvres) and psychological symptoms of anxiety (perception of threat and anticipation of catastrophe) are elicited simultaneously by a subcortical threat detection mechanism. This perspective might help to integrate conflicting earlier approaches. It is discussed with respect to theoretical, empirical, and clinical implications.