The continuing objectives of this project is to develop effective psychosocial treatments for panic disorder and generalized anxiety disorder. Progress during the last several years of this project combined with preliminary data from other centers suggests that we may be on the verge of developing a successful non-drug treatment for panic. Preliminary clinical outcomes indicate that panics can be eliminated in from 80 to 100% of patients with panic disorder. Preliminary data from this project indicate that these results are substantially different from a control group. One goal of this project will be to replicate and extend our preliminary findings by examining the effects of three treatment procedures currently thought to be crucial in the non- drug treatment of panic. To a basic information-cognitive therapy component directed at misperceptions and cognitive distortions regarding panic two procedures will be added. The first will be breathing retraining which is based on the hypothesis that a proneness to hyperventilation forms the basis of panic attacks. The second will be systematic exposure to interoceptive cues thought by many to form an essential part of any psychosocial approach to panic. In a fourth group all components will be combined. The effectiveness of all treatments will be assessed utilizing standardized measures of panic as well as a CO2 challenge which has proven to be a reliable panic provocation procedure. A second goal is to continue with our ongoing evaluation of the effectiveness of cognitive and relaxation treatments and their combination for generalized anxiety disorder. Recent reconceptualizations and redefinitions of generalized anxiety disorder, emphasizing the importance of cognitive components within this disorder suggest that cognitive therapy should be particularly appropriate. Our preliminary evidence supports this suggestion. In addition, we will continue to follow all treated patients to examine long term impact of treatment and investigate potentially important predictors of outcome. Associated studies on the nature of panic, nocturnal panic, and relaxation associated panic will continue.