Individuals who smoke are more likely to experience panic attacks and develop panic disorder than those in the general population. One possible explanation is that smokers may experience a heightened fear response to somatic disturbances. To date, few laboratory studies have tested this hypothesis directly. The present study examined 24 adult heavy smokers (10 females) in 12-hr nicotine withdrawal and 24 adult nonsmokers (12 females) on subjective and physiological reactivity to a 4-min carbon dioxide rebreathing challenge. Results indicate that, despite an attenuated acceleration in respiration during the challenge, smokers experienced a significantly greater increase in self-reported panic symptoms than nonsmokers. In addition, smokers reported significantly greater trait levels of suffocation fear prior to the challenge. Findings are discussed with respect to the role of smoking in panic vulnerability.