The PanCam (Panoramic Camera) comprises a stereo pair of cameras that sit ~50cm apart on what is called an optical bench (a bar - see diagram). Together they can provide stereo 3D images that can be used to determine the distance that objects are away from the Rover.
The PanCam is mounted on a Pan and Tilt mechanism that allows it to be swivelled so that images with a sweep of 360 degrees can be created. This is done by taking a stereo picture, rotating the camera a few degrees, rotating it a bit more, taking another image and so on, until a set of images covering the full 360 degrees has been achieved. The images can then be stitched together to form a 360 degree panorama by the PRoVisG software tools.
These images can be viewed in 3D if you have the right kind of equipment. If you have a red/green pair of 3D glasses you can view a 3D image here.
Each PanCam has a set of filter wheels that enable scientists to select only certain frequencies of light when taking images (e.g. Infra-red, Ultra-violet, red, green, blue etc). This can be used by scientists to provide information about the composition of items in the image e.g. what kind of rock, sand etc.