Originally titled "Panic", the earliest known version of the song existed in 1998, performed live during the band's first gig in the same year.

The track was reproduced by Coldplay and British producer Ken Nelson for the band's debut album, Parachutes.

Following their successful releases in 2000, Coldplay and their record label Parlophone thought there was enough exposure of the album in the United Kingdom.

[3] This version has a different melody, and the lyrics are an account of a "slightly disastrous evening Chris had spent entertaining a young lady called Alice Hill".

[4] For Coldplay's debut album Parachutes (2000), British record producer Ken Nelson re-produced "Don't Panic".

[10] Following the successful single releases of the album in 2000, the band thought that Parachutes had gained enough exposure in significant regions in the United Kingdom.

In 2004, the band rejected a multi-million-Euro offer from Diet Coke and Gap to use "Don't Panic" and "Trouble", another song featured in the album.

[17][18] It was also referenced in the 2016 movie The 5th Wave as a lullaby to the main character Cassie Sullivan (Chloë Grace Moretz)'s little brother Sam (Zackary Arthur).

"[6][7] Performances during 2017 legs of A Head Full of Dreams Tour would feature drummer Will Champion as lead vocalist.

MacKenzie Wilson, in his review from AllMusic, notes, "Coldplay's indie rock inclinations are also obvious, especially on songs such as 'Don't Panic' and 'Shiver'.

"[21] Spencer Owen from Pitchfork wrote that "This subdued, dreamy opener contains Martin's falsetto chorus of 'We live in a beautiful world,' which seems to sum up the overall sentiment of the record.

'Don't Panic' is filled with excellent guitar tones and a nice grooving back beat, and I love the way the song ends".

The video starts off with an animated diagram of the water cycle, then portrays the band as two-dimensional paper cutouts doing household chores, when suddenly disaster strikes the earth in the forms of floods, volcanoes and electric shocks.