Panic allows survivors to drop all of their weaponry besides their selected weapon and gain an increase in speed and stamina. Panicking is often used in a last ditch effort to escape, but some players abuse this ability to beat other players to the more powerful weapons they spot.
Panicking will give a survivor full stamina, regardless of how fatigued they were when they panicked, and the speed boost will last for a short amount of time. After the survivor's stamina depletes, they will begin to move slowly again. The player's ability to panic will recharge for a certain amount of time before the ability becomes available again.