Carbon dioxide (CO2) inhalation induces acute anxiety and panic attacks in patients with Panic Disorder (PD). Anti-panic drugs decrease CO2 reactivity after the first days of treatment; however, the clinical meaning of this finding has not yet been established. This study investigated the effects of treatment with tricyclic antidepressants and selective serotonin re-uptake inhibitors (SSRIs) on CO2 reactivity and compared the relationships between 35% CO2 hyperreactivity modulation and short-term clinical outcome. One hundred twenty-three patients with PD with or without agoraphobia who were hyperreactive to CO2 were randomly assigned to treatment groups with imipramine, clomipramine, paroxetine, sertraline, or fluvoxamine. A double-blind, randomized design was applied. Each patient received the 35% CO2 challenge on days 0, 7, and 30. The severity of clinical symptomatology was measured on days 0 and 30. Decreased hyperreactivity to 35% CO2 in all five treatment groups was already evident after the first week. The decrease in CO2 reactivity at the end of treatment was proportional to the degree of clinical improvement. Multiple regression analyses showed that the decrease in CO2 reactivity after the first week was a significant predictor for good clinical outcome after one month. The results of this study confirm evidence that psychoactive drugs effective in the treatment of PD decrease CO2 hyperreactivity. They also suggest that precocious modulation of CO2 reactivity might fairly reliably predict short-term clinical outcome in patients with "respiratory" PD.