Panama is a village in Chautauqua County, New York, United States. The population was 491 at the 2000 census. The village is named after a large rock formation south of the village, called Panama Rocks. This site has become a tourist attraction, and the owners charge admission at the gate. The Village of Panama is in the northwest part of the Town of Harmony, New York. The village is at the junction of Route 474 (Main Street) and Route 33. The Panama Rocks scenic attraction is south of the village. It has Paleozoic fossils in an outcrop.