The Photoshop Document Format is a proprietary format by Adobe Inc used by Photoshop and some other Adobe products. It stores any image content that Photoshop can handle.
PSD is limited to 30,000 pixels either side. Since Photoshop version 8 (CS) a new format is available, that can store up to 300,000 pixel each side, the Photoshop large document format called PSB.
Panotools can write 8 bit per channel PSD files with layers (sometimes called 24 bit files) or background layer only PSD files with 16 bit per channel (sometimes called 48 bit files).
Some image viewers claim to be able to read PSD files. However, in each PSD file there is stored a flattened version of the contained multi layer image, which is displayed in this case.