Panic is the mechanic that will make you lose the game, once you have enough (8) countries reach high enough panic to leave the XCOM project; then the game is over. As the Commander, it's your task to keep this from happening. Each country has a panic value of 1 to 5, and a country has a high chance of leaving the project if its panic level is 5 at the end of a month. For specifics on how countries stop supporting XCOM see Defections.
On the Easy and Normal difficulties all countries will start with a level 1 panic. On Classic difficulty, 50% of the Council countries will already be at a level 2 panic. On Impossible Difficulty, all 16 countries will have a level 2 panic.
Panic will increase in countries as they are targeted by alien attacks, and can also spread to other countries on that continent, depending on the difficulty level.
- Unstopped Abductions raise panic by 2 points in the country (3 on Impossible difficulty), and will further raise panic on the rest of the continent by 1 point;
- Failing a Terror mission will cause the targeted country to leave the project immediately and will raise panic on the rest of the continent by 2 points;
- UFO missions will raise panic by 2 points if alien craft isn't intercepted, and by 1 point if it is intercepted but UFO isn't shot down;
- Most Council missions will raise panic if ignored or failed but a few missions will have no effect on panic;
- Panic will be applied only in the targeted country on the Easy, Normal and Classic difficulties. On Impossible level mission failure will also raise panic on neighbouring countries;
- There are 6 Council missions that don't raise any panic: the Industrial, Pier and Truckstop Asset Recovery missions, and the Pier Extraction (Sgt. Carlock), Boulevard Rescue (Anna Sing) and the Commercial Extraction (William Thorne) missions.
- Satellites destroyed raise panic by 2 points in the country, and by 1 point on the rest of the continent;
- EXALT Propaganda operations can also raise panic in the country where the cell is based;
- On Easy difficulty they will raise panic by 1 point, on Normal and Classic 2 points and on Impossible 3 points;
- On Impossible they will also raise panic on the rest of the continent by 1 point;
- Active EXALT cells also have a 50% chance of increasing panic by 1 point in the country where they are based, if unchecked alien activity occurs on that country;
- Wrongly accusing a country of harboring the EXALT base will cause it to immediately leave the XCOM project (if it is still in the Council) and it will also raise panic on the rest of the continent by 2 points;
- Failing to destroy the EXALT base during the raid mission will also cause the country to leave the Council or raise panic on the rest of the continent by 2 points.
Satellites are the primary way to lower panic; deploying a satellite over a country will immediately calm the population.
- Succeeding at a Terror mission will reduce the panic level the country and continent, with the value being dependent on the number of civilians saved. For more details see Terror mission results.
- Most Council missions will reduce panic by 1 to 4 points, depending on the specific mission.
- Successful Abduction missions reduce panic on that country by 3 points;
- UFO shootdowns reduce panic on the country it occurs by 1 point;
- Successful UFO Assaults reduce panic on the country where they crashed/landed by 1 point;
- Satellites deployed over a country reduce panic immediately on that country by 2 points. Over the next months the satellite will have a chance of further reducing panic depending on the country's panic level at the end of the month
- Countries with a Level 5 panic have 100% chance on Easy/Normal and 50% on Classic/Impossible;
- Countries with a Level 4 panic have 50% chance on Easy/Normal and 25% on Classic/Impossible;
- All other panic levels have a 25% chance on Easy/Normal and 10% on Classic/Impossible;
- Assaulting the Alien Base reduces worldwide panic by 2 points (it reduces only 1 point on Classic and Impossible difficulties in the Enemy Within DLC).
- Eliminating EXALT cells through Covert Data Recovery or Covert Extraction missions reduce 1 point of panic in the country they take place.
- Assaulting the EXALT base will provoke a worldwide panic reduction of 1 point.
- Also on the Enemy Within DLC, if Canada has already left the Council when the Site Recon mission takes place, the panic reduction will be applied to either the USA or Mexico, chosen randomly.
- Overall, to have no countries leave your project your aim is to have, by the end of the month, no more countries in the "red" (full panic) zone than you have satellites, and launch those satellites to save those countries from defecting. This means you will not be getting the continent you want, but the continent that got more unlucky with panic levels.
- Your other goal is to cover full continents as soon as possible for both the continent bonus AND no further panic problems with this country. Having a country not covered in a partially covered continent leaves you very vulnerable, because you cannot manage panic in already covered countries (like you can with uncovered countries by launching satellite in those countries right before council report). Worst case scenario, when you barely saved a country from defecting (launched satellite into panicked country), you can only afford to have 1 abduction there until you have full panic again, plus 1 for each council mission that awards worldwide panic reduction. Therefore, there is a huge incentive to cover full continents.
- Getting all continents but one covered stops abduction missions from happening all together, and solves the panic problem for the rest of the game. Therefore, deploying satellites as fast as possible is the best way to control the panic. Consider deploying 1 satellite in the first month, 3 in the second month, at least 3 (if you can, 5) in the third month and cover all remaining countries except one in the next month.
- It is never a good idea to launch a satellite at any time except right before council report. That is, because abductions can happen even right before the Council report, and if you don't have spare satellites to fix panic after them, you will lose countries. Launch satellites right before the Council report, first fixing any countries in "Red", and then according to your plan.