What is Paxil (Paroxetine)? Paroxetine is used to treat depression, panic attacks, anxiety disorders, and a severe form of premenstrual syndrome (premenstrual dysphoric disorder). It works by helping to restore the balance of a certain natural substance (serotonin) in the brain. Paroxetine is known as a selective serotonin reuptake inhibitor (SSRI). This medication may improve your mood, sleep, appetite, and energy level and may help restore your interest in daily living. It may decrease fear, anxiety, unwanted thoughts, and the number of panic attacks.