Note: You may need a third party program to manually stitch together images that were not taken in panoramic mode or ones that the program finds difficult to automatically stitch.
The Panorama mode is typically located in your Mode Menu. Once enabled you'll instantly see a panoramic frame or guide appear on your LCD screen (provided you're using an Olympus xD-Picture Card or Olympus SmartMedia card). Your model may permit you to choose the direction of the guide from left to right or bottom to top. Typically, hitting the corresponding arrow on the keypad adjusts the direction of the guide.
Use the guide to help set up your first shot and corresponding shots. Your second shot should be set up so part of the first shot overlaps into the second shot and so on (see example below).
Normally, you should shoot each shot from left to right or down to up. Choose an area with contrast as your overlapping point, like a green tree with brown branches. If there happens to be no contrast in the shot, such as a white or blue wall, the OLYMPUS Master software will most likely have a problem determining the overlap point.
Choose a scene in which the brightness is as even as possible across the entire scene; i.e., avoid one shot with a bright sun going into the next shot without a bright area. Most cameras will set the exposure based on the first shot and then use that same exposure for the following shots, which is why the above-mentioned example would not work because the exposure would be incorrect for the second shot.
The sky in this panoramic is ideal since the sky is an even brightness from shot to shot.
A tripod makes it easier to keep the camera at the same level across several shots. Even a table tripod available in the camera accessory section of most consumer electronic stores can be placed on a steady surface.