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Panic patients consistently show exaggerated lactic acid response to alkalosis, whether produced by hyperventilation or by sodium lactate infusion. Understanding why this occurs may provide important clues to the pathogenesis of panic disorder. Although brain hypoxia from excessive hypocapnia-induced cerebral vasoconstriction is often cited as the mechanism of elevated brain lactic acid in panic disorder, studies of brain metabolism show that hypocapnia rarely leads to brain hypoxia. Increased lactic acid production is a normal response to intracellular alkalosis and to intracellular cyclic AMP. Thus, other possible mechanisms of the exaggerated lactic acid response in panic disorder include a disturbance of mechanisms regulating intracellular pH and factors increasing intracellular cyclic AMP. Both mechanisms are consistent with the suffocation false alarm theory of panic disorder. This review suggests a theoretical framework for future magnetic resonance spectroscopy studies that can test some of the predictions of these competing models.