Many varieties of the overprinting of PANAMA and CANAL ZONE exist, including doubled overprinting, complete inverts and stamps with the letter A inverted or completely missing. These in turn were used for Canal Zone postage and were again, overprinted with CANAL ZONE with a red bar at top blocking out the name Colombia. The first Panama stamps consisted of existing Colombian stamps, which were overprinted with Panama. Beforehand the domestic rates of postage in the United States were made applicable to all possessions of the United States on June 20, 1904, which henceforth included the Canal Zone. The Canal Zone Post Office was inaugurated on June 25, 1904. The Republic of Panama was formally part of Colombia, and after it broke away from Colombia, with assistance from the United States, it established itself as a separate nation where it immediately became necessary to establish its own post offices and issue its own postage stamps. 14.3 Canal Zone seal and jet, issues of 1965–1976.Philatelists have identified over 100 varieties, some of them quite rare (and counterfeited). Initially these were the current stamps of Panama or (less often) the U.S., overprinted with 'CANAL ZONE' in various styles. The Canal Zone Post Office began operating and issued its first postage stamps on June 24, 1904. Along with ships and freight, domestic mail and mail from around the world moved through the canal. In the towns where there were railroad stations, the station agents of the Panama Railroad functioned as postmasters. The Canal Zone and its post offices, with the main distributing office in Cristobal, operated as an independent government agency under the direct authority of the President of the United States.

Upon the establishment of the Canal Zone in 1903, seventeen Post Offices had also been established and were operated by the U.S. The Canal Zone was a strip of territory 50 miles (80 km) long and 10 miles (16 km) wide across the Isthmus of Panama, and was ceded to the United States for the purpose of constructing and operating the canal which connected the Atlantic and Pacific Oceans. Postage stamps and postal history of the Canal Zone is a subject that covers the postal system, postage stamps used and mail sent to and from the Panama Canal Zone from 1904 up until October 1978, after the United States relinquished its authority of the Zone in compliance with the treaty it reached with Panama.

1928 airmail 5 cent stamp