Patients with a primary diagnosis of Panic Disorder without Agoraphobia or Panic Disorder with Agoraphobia according to DSM-IV criteria, and co-morbid major depressive disorder are eligible. Patients are required to have a weekly panic attack frequency of greater than or equal to 1/ week in the month prior to intake or a CGI score greater than 4 in the week prior to randomization. Patients with co-morbid major depressive disorder will be included provided that the onset of PD was earlier than the onset of the depressive disorder. The presence of co-morbid depression will be determined by using DSM-IV criteria for major depressive disorder, and HDRS scores will be in the moderately-to-severely depressed range (greater than 15).