This is an excerpt from an article on the effects of fear on the brain from the January/February 2010 issue of Discover:

“Fear is not a single thing after all. Rather, it is a complex, ever-changing strategy mammal brains deploy in order to cope with danger. When a predator is off in the distance, its prey – whether rat or human – powers up a forebrain network. The network primes the body, raising, the heartbeat, and preparing it for fast action. At the same time, the forebrain network sharpens the brain’s attention to the outside world, evaluating threats, monitoring subtle changes, and running through possible responses. Another important job it performs is keeping the midbrain network shut down so that, instead of fleeing at top speed, a prey animal keeps very still at first. As the predator gets closer, however, the forebrain’s grip on the midbrain loosens. Now the midbrain becomes active, orchestrating a powerful, quick response: fight or flight. At the same time it shuts down the slower, more deliberative forebrain. […]

Unfortunately, our exquisitely sophisticated brains may make this predator-defense circuit vulnerable to misfiring. Instead of monitoring just the threats right in front of us, we can also imagine threats that do not exist. Feeding this imagination into the early-warning system may lead to crippling chronic anxiety. In other cases, people may not be able to keep their periaqueductal gray [is the gray matter located around the cerebral aqueduct within the tegmentum of the midbrain] and other midbrain regions under control. As we perceive predators getting closer, our brains normally make the switch from the forebrain to the midbrain regions. People who suffer panic disorders may misjudge threats, seeing them as far more imminent than they really are.”
– Carl Zimmer