Background: Anxiety disorders and pain are commonly comorbid, though little is known about the effect of pain on the course and treatment of anxiety. Methods: This is a secondary analysis of a randomized controlled trial for anxiety treatment in primary care. Participants with panic disorder (PD) and/or generalized anxiety disorder (GAD) (N=191; 81% female, mean age 44) were randomized to either their primary‐care physician's usual care or a 12‐month course of telephone‐based collaborative care. Anxiety severity, pain interference, health‐related quality of life, health services use, and employment status were assessed at baseline, and at 2‐, 4‐, 8‐, and 12‐month follow‐up. We defined response to anxiety treatment as a 40% or greater improvement from baseline on anxiety severity scales at 12‐month follow‐up. Results: The 39% who reported high pain interference at baseline had more severe anxiety (mean SIGH‐A score: 21.8 versus 18.0, P<.001), greater limitations in activities of daily living, and more work days missed in the previous month (5.8 versus 4.0 days, P=.01) than those with low pain interference. At 12‐month follow‐up, high pain interference was associated with a lower likelihood of responding to anxiety treatment (OR=.28; 95% CI=.12–.63) and higher health services use (26.1% with ≥1 hospitalization versus 12.0%, P<.001). Conclusions: Pain that interferes with daily activities is prevalent among primary care patients with PD/GAD and associated with more severe anxiety, worse daily functioning, higher health services use, and a lower likelihood of responding to treatment for PD/GAD. Depression and Anxiety, 2009. � 2009 Wiley‐Liss, Inc.