This isn't exactly in Panama City Beach, but quite a few people that visit PCB take a day trip over toward Mexico Beach, Port St. Joe, Apalach, etc while they are here (considered the "Forgotten Coast"). It's about an hour drive east of PCB and the beaches are just as beautiful but much less crowded. It's a little bit of "old Florida" that's not over-developed with hi-rise condos and tourist traps.
One of the most pristine areas is St. George Island. And one of the best restaurants - the only
beachfront restaurant on St. George Island - is Blue Parrot Oceanfront Cafe. This place is great... the seafood is fresh, the portions are big and the location is perfect if you enjoy the beach. If you want to see for yourself, check out their
Live Web Cam and
their menu. If you go, you'll be glad you got to enjoy a little bit of old Florida and some of the best seafood in the country (nearby Apalachicola is legendary for their fresh seafood and oysters).
If you get the chance.. both the area and Blue Parrot are highly recommended!