Panoramic radiography has become a commonly used imaging modality in dental practice and can be a valuable diagnostic tool in the dentist’s armamentarium. However, the panoramic image is a complex projection of the jaws with multiple superimpositions and distortions which may be exacerbated by technical errors in image acquisition. Furthermore, the panoramic radiograph depicts numerous anatomic structures outside of the jaws which may create additional interpretation challenges. Successful interpretation of panoramic radiographs begins with an understanding of the normal anatomy of the head and neck and how it is depicted in this image type. This article will describe how osseous structures, soft tissues, air spaces and ghost shadows contribute to the final panoramic image. A systematic and repeated approach to examining panoramic radiographs, which is recommended to ensure that critical findings are not overlooked, is also outlined. Examples of challenging interpretations, including variations of anatomy, artefacts and disease, are presented to illustrate these concepts.