One of the main advantages of digital imaging is the possibility of altering display options for improved image interpretation. The aim of the present study was to evaluate the subjective image quality of direct digital panoramic images and compare the results with those obtained from conventional images. Furthermore, the effect of various filter settings on image interpretation was assessed. Panoramic images were obtained with three different types of panoramic equipment (one direct digital and two conventional units) from three groups of 54 patients with a natural dentition in all quadrants. The first series of panoramic images consisted of 54 unprocessed digital images; conventional film images (n = 108) comprised the second and third series. A final series consisted of the digital images treated with three different filters ("smoothening," "sharpening," and "contrast enhancement"). All images were scored randomly by four experts in oral radiology on a 4-point rating scale. The results showed a statistically significant difference in scorings between the conventional and digital panoramic units. The main reason for poor image quality appeared to be a combination of blurring and overlapping in the panoramic image. The premolar region in the upper jaw was the region where most additional radiographs were needed.