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This pilot process study is part of a larger randomized controlled trial of Panic—Focused Psychodynamic Psychotherapy (PFPP) comparing it with a placebo—control treatment, Applied Relaxation Therapy (ART). Of 49 subjects in the total RCT sample, 26 were in PFPP and 29 in ART. Treatment outcome was evaluated at termination by raters blinded to patient condition and therapist orientation, and at 2, 4, 6, and 12 months post—treatment, using diagnostic and symptom measures recommended by the NIMH consensus conference on treatment of panic disorder (Milrod et al. in press). The primary outcome variable was the