What is under the panels?
Do you want to replace with paneling. Go with plaster or drywall or wallpaper?

It appears there's textured wall beneath. I have decided to remove all the panelling and paint the walls. It's too dark with the panelling. Thanks for the reply, Homedoc!

We removed some paneling (one wall) in our living room. If it's not glued down, it should come off very easily. If the surface behind it has never been painted, make sure to prime it first with an appropriate primer. If it has been painted, it can't hurt to prime it anyway. Ours was unpainted drywall, but we bought a primer that can be used on painted or unpainted surfaces so we can prime the whole room and then paint. Oh, and don't forget to fill in any nail holes!

Good luck!

Thank you for the tip on primer. My panelling is both nailed and glued in spots - just my luck! I appreciate your response.