Formation and early years (2004–2005)The band was formed in Las Vegas, Nevada, by childhood friends Ross on guitar and Smith on drums. Later they recruited more members to create a band under the name of "The Summer League" with Brent Wilson and Trevor Howell. Howell would later leave the band.
Wilson met Urie at Palo Verde High School. Wilson asked Urie to try out as guitarist for the fledgling band, as they were looking for a replacement for Trevor at the time. Originally, Urie was not the band's lead singer. Rather, the position belonged to former guitarist and lyricist Ross. When they heard Urie sing backup vocals during a rehearsal, they were impressed with his backup vocal abilities and unanimously decided to make him the singer. The band then settled on the name Panic! at the Disco, which comes from the song "Panic" by Name Taken. The band contacted Fall Out Boy bassist Pete Wentz through LiveJournal and sent him an internet link to their PureVolume site. Wentz took a trip to Las Vegas to meet the band. After seeing them practice, he asked if they would sign with his Fueled by Ramen imprint label Decaydance which made them the first on the new label.
 A Fever You Can't Sweat Out (2005–2007)A Fever You Can't Sweat Out on September 27, 2005, making a fan base through PureVolume and MySpace, though achieving little initial commercial recognition. After a consistent presence in PureVolume's top 10 signed artists, and reaching number one in MySpace's indie charts, Panic! at the Disco were featured on MTV's Total Request Live on January 17, 2006, where they premiered their music video for "I Write Sins Not Tragedies." Featuring Lucent Dossier Experience and a circus wedding theme, the video débuted at #10 on the TRL countdown, later winning the Video of the Year award at the 2006 MTV Video Music Awards.
Their second single, "But It's Better If You Do", was released in the UK on May 1, 2006 where it debuted, and peaked, at #23. The accompanying music video, released the previous month, portrays the band playing in a speakeasy in 1930's America, which, according to Urie, shows "the dark and secluded style of Panic!."
The band announced the departure of Wilson with a message on the band's website on May 17, 2006. Wilson has since claimed that the decision to leave was not his, and that he was fired without warning for monetary reasons. Wilson demanded a cut in royalties, and threatened to take his former band to court.
Just days after Wilson's departure, the band embarked on their first headlining tour through Europe, with long-time friend Walker filling in for the summer tour on bass while a permanent replacement was sought. All of the dates were sold out. Upon their return, the band embarked on a two-month North American headlining tour with supporting acts The Hush Sound, OK Go, The Dresden Dolls, and Lucent Dossier Vaudeville Cirque, still retaining Walker as a temporary bassist. On July 3 of that year, the band's MySpace profile was edited to list Walker as bassist/vocals, and he became a permanent member of Panic! at the Disco.
The success of their first two singles helped catapult their debut album to the top of the Billboard Independent chart and to #13 on the Billboard 200 in July 2006.
Toward the end of July 2006, Panic! At the Disco released their third music video, "Lying Is the Most Fun a Girl Can Have Without Taking Her Clothes Off." The video features people with fish tank helmets walking the streets of what appears to be a studio back lot. The video only shows the band in one shot, reportedly because they felt that their looks were distracting from their music.
In early August 2006, A Fever You Can't Sweat Out went Platinum, having sold over one million albums.
During Panic!'s opening song at the 2006 Reading Festival, an audience member threw a bottle at the stage, which struck Urie in the face and knocked him unconscious, forcing the band to stop playing. After a few minutes, Urie got back up and shouted to the crowd, "You can't take me out! Let's see what you guys do with my left side", and continued with the same song. In a phone interview Ross stated that "We were kinda expecting that [bottling] going into the Reading, because we heard that that's kinda a tradition they have over there" and "We walked on and we were kinda expecting that to keep our heads up the whole time, and unfortunately Brendon, he was catching bottles coming towards me and Jon and then he was dodging them himself, and kinda just didn't see one coming that I saw and it got him pretty good, and I dunno that's the only time anything like that's ever happened so hopefully we won't have to worry about anything like that too much."
The band embarked on a world tour in the later part of 2006. It included dates in Australia, New Zealand, and continental Europe. On November 7, 2006, they kicked off their first-ever arena tour with Bloc Party (who shortly dropped out because of drummer Matt Tong suffering a collapsed lung) and Jack's Mannequin. The Plain White T's were added to the next few weeks of The Nothing Rhymes With Circus Tour. They opened up the shows beginning in New York through November 26 in Iowa. After that, Cobra Starship were on the tour through December 9 in San Diego. The band appeared along with Fall Out Boy, Marilyn Manson, and other bands on the special edition soundtrack of Tim Burton's The Nightmare Before Christmas covering "This Is Halloween", which was re-released in 3D on October 20.
Their final single from A Fever You Can't Sweat Out, "Build God, Then We'll Talk", was released on March 5, 2007. The accompanying music video portrays the fallacy of relationships.
In May 2007 it was announced that a Smashing Pumpkins Tribute LP would be released, compiled by MySpace and Spin. The LP features Panic!'s cover of "Tonight, Tonight" and was included free in the June 26, 2007 issue of Spin.
 Pretty. Odd. and ...Live In Chicago (2008)In early 2007, Panic! at the Disco began writing their follow up album, but decided to scrap all of the songs they had written so far that they had been working on in July 2007. While speaking to MTV, Ross explained that, before the decision to start over was made, the album had lacked a band set up and that it "sounded like a film score." He explained that the new songs have "a more positive outlook to them." The band began performing new songs during various festivals and gigs. Two of these songs were "Nine in the Afternoon" and "When the Day Met the Night".
On January 9, the exclamation point in the band's name was dropped. They defended the decision to drop the exclamation point during an interview with MTV: "It was never part of the name to us. (...) When we started doing new promo stuff for this album, we just told everyone not to use it anymore."
On December 11, it was announced on Billboard.com that Panic's second album was set to be released on March 25, 2008. Later that day, a series of puzzles began to appear on the Panic! at the Disco website. The first puzzle led to the answer of "YOU DON'T HAVE TO WORRY" – Smith explained that it was a lyric from a song named "We're So Starving".
The video for "Nine in the Afternoon" was shot on the December 21 and 22, ahead of the release as a single in January 2008.
A second puzzle revealed samples from a song on the upcoming album with the third piece of the puzzle leading to a blog entry on MySpace which updated the progress of the album while releasing a rough version of the song "We're So Starving". The band announced that they would be recording the strings and mixing the album at Abbey Road Studios. Panic later confirmed that the second album was titled Pretty. Odd. with a release date of March 25, 2008. A fresh puzzle appeared on the band's website on January 16, various parts of the puzzle were released on to different websites. A week later, the completed puzzle appeared on the website revealing the album cover of Pretty. Odd. On January 10, Panic at the Disco were confirmed as headliners for the 2008 Honda Civic Tour. The tour started from April 10 in San Francisco and finished in Anaheim on June 14. The band customized their own Honda Civic Hybrid that would be won by a fan and ticket holder.
On January 28, "Nine in the Afternoon" was made available (in full) on the band's official MySpace page. iTunes made the Deluxe Edition and Standard Edition of the album available for pre-order on January 29, 2008. The day after the video for the first single "Nine in the Afternoon" aired, the band shot a whole new video for the next single, entitled "That Green Gentleman (Things Have Changed)".
On March 30, the album hit #2 in the UK Albums Chart. The album debuted at #2 in the U.S., selling 139,000 copies in its first week. On April 8, the album debuted at #1 in Australia.
In August, Panic! at the Disco embarked on the Pretty. Odd. World Tour, performing in Singapore, South Korea, Japan, Hong Kong, the Philippines, Indonesia, Australia and New Zealand; accompanied by The Academy Is... and Cobra Starship in the last two countries.
In December, the band released the DVD/CD set, ...Live in Chicago. The DVD contained the filming of the Chicago show of the Honda Civic Tour, a featurette, music videos and documentaries on the filming of the music videos, whilst the CD included all songs played at the same show, as well as alternative versions of four songs from Pretty. Odd.. A deluxe Limited Edition was made available, containing all the components as the Standard Edition as well as a hardcover book of photographs, "A Picture with books" taken by longtime friend Shane Valdez. A limited 4,000 copies were made available, and more than 3,700 copies were pre-ordered before the initial release date of December 2, 2008.
 Departure of Ross and Walker and third studio album (2009–present)On July 6, 2009 it was announced via the band's official website that Ross and Walker had left the band due to musical differences. The two are in a new band, The Young Veins, and are finished with their first album Take a Vacation!.
On July 10, Smith posted a short message on their website stating that they have been hard at work in the studio on their third album. Along with the message he included a 30 second clip of a new demo they have been working on titled "Oh Glory". The band reinserted the exclamation mark into its name a few days after the departure of Ross and Walker.
The band then released their single, "New Perspective" on July 28. On July 29, 2009 Smith reported that former The Cab member Ian Crawford was going to fill in for Ross on their tour during the summer of 2009. Dallon Weekes, singer/songwriter of the indie band The Brobecks, filled in for Walker on bass on the tour as well.
On April 20, Panic! at the Disco began working on their next album, the title of which has not yet been released. The new album will be produced by John Feldmann. In July 2010, the band announced via Twitter that the guitar, bass, drums, and percussion were finished for the new album.
On July 26 in an interview with Brendon Urie, he said that the recording was finished and they plan to mix and then to release it in early 2011.
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