Abstract.A new two-dimensional panel technique has been developed to solve Laplacian flows, which eliminates the edge effect present in traditional panel methods. Such a method is very useful for applications where the velocity induced by the panels is required at arbitrary locations. Particle based flow solvers are a prime example. The method, however, requires considerably more computational effort. In this paper the method is modified to improve computational efficiency by adapting the fast multipole algorithm for the panel method. Significant improvement in computational efficiency is obtained while ensuring that the edge effects are eliminated.Key words. panel method, edge effect, fast multipole method AMS subject classifications. 31A99, 34B60, 35J05, 65E05, 65Y99, 76M15 PII. S1064827500374662 1. Introduction. Panel methods provide an elegant methodology for solving a class of flows past arbitrarily shaped bodies in both two and three dimensions. The basic idea is to discretize the body in terms of a singularity distribution on the body surface, satisfy the necessary boundary conditions, find the resulting distribution of singularity on the surface, and thereby obtain fluid dynamic properties of the flow. The body geometry is represented in terms of smaller subunits called panels, hence the name "panel" method. In two dimensions the panels are usually straight lines, and in three dimensions planar elements are used. The singularities used can be either sources, doublets, or vortices. Each panel is constructed to have some kind of singularity distribution. Depending on the accuracy, computational speed and other factors one can use constant, linear, parabolic, or even higher orders of distribution of the singularity on each panel. The number of panels that represent the body can also be varied. The actual singularity distribution is initially unknown, but by enforcing the boundary conditions on the body, it is possible to solve for them. The boundary conditions can be represented in terms of the velocity field, called the Neumann condition, or in terms of the potential inside the body, called the Dirichlet condition. Hess and Smith [8] laid the foundation for the source panel method. The idea of the vortex panel method is due to Martensen [14] and is extended by Lewis [10]. Katz [9] gives an excellent, comprehensive overview of panel methods in general (in both two and three dimensions).The main advantage of the panel method is that it is relatively easy to formulate and compute. The panel methods are also "grid free" and represent the geometry as accurately as possible. Rajan [16] also shows that the vortex based panel methods are capable of explaining both the kinematic motion of the rigid body and the fluid flow. Unlike finite difference methods panel methods are, however, a little restrictive in their applicability. Typically panel methods are used to solve Laplacian flows, which they solve very accurately and efficiently. There are techniques to handle compressible flows past thin bodies by using t...