Panamarenko studied at the academy of Antwerp. Before 1968, his art was inspired by pop-art, but early on he became interested in aeroplanes and human powered flight. This interest is also reflected in his name, which supposedly is an acronym for “Pan American Airlines and Company”.
Starting in 1970, he developed his first models of imaginary vehicles, aeroplanes, balloons or helicopters, in original and surprising appearances. Many of his sculptures are modern variants of the myth of Icarus. The question of whether his creations can actually fly is part of their mystery and appeal.
The artists he admires include, amongst others: Joseph Beuys, Marcel Broodthaers, Bruce Nauman and Pablo Picasso.
In 2003 Panamarenko married the 34 year younger Eveline Hoorens. At the opening of a large-scale overview exhibition of his work in Brussels in 2005, Panamarenko announced his retirement as an artist. He has since promoted his own coffee brand PanamaJumbo.
On 24 April 2009, VLM Airlines based in Antwerp, Belgium named one of its Fokker 50 aircraft in his honour. 
While retired, Panamarenko created the Waving Crabs, a series of fountains sprayed by crab figures on three stainless-steel half bowl shaped islands situated in the Zegemeer, a large pond at Knokke-Heist. He inaugurated it on 7 October 2011 stating the idea dated from 1975.