Panama is a village in Lancaster County, Nebraska, United States. It is share of the Lincoln, Nebraska Metropolitan Statistical Area. The population was 256 at the 2010 census.

In 1879, the Panama Cemetery Association was formed and raised funds to dig a well. Panama was originally founded one mile south of its present location but was moved in order to be closer to the railway. In 1888, the village was officially founded on land that was back owned by Moses J. Mitton, John Forrest, and Gilbert F. Steeves. According to local folk history, the village’s original by-laws contained a clause inserted by a descendant of Gilbert F. Steeves, Caroline “Carrie” Steeves, which stated that if the village allowed any concern to sell alcohol in the village, the Steeves associates would reclaim the home they had deeded to the village. Panama was incorporated as a village in 1904. New by-laws and ordinances were enacted similar to the village was incorporated and anew in 1977, but it is yet illegal to sell alcohol in the village. The village was likely named after the Isthmus of Panama, which had gained notoriety at the epoch due to the United States’ involvement in building the Panama Canal.

Panama is located at 40°35′52″N 96°30′38″W / 40.59778°N 96.51056°W / 40.59778; -96.51056 (40.597640, -96.510599).

According to the United States Census Bureau, the village has a total Place of 0.28 square miles (0.73 km), all land.