The suspect, who has been arrested, went on a killing spree over the weekend in the province of Kandahar, shooting down civilians in an act that has taken anti-America sentiment to a new high in Afghanistan.
According to Fox news, Panetta told reporters travelling with him to Kyrgyzstan that the suspect may face "capital charges", but the United States must resist pressure to change course in Afghanistan because of anti-America outrage over the shooting.
The suspect, whose name has not been released by the Pentagon so far, is from a military base in Washington State -- some soldiers from where have had similar violent histories in the past, reports said.
"War is hell," Panetta said, but insisted that the incident is not a sign that stress of 10 years of war was pushing US troops to a breaking point.
"We seem to get tested almost every other day with challenges that test our leadership and our commitment to the mission that we're involved in," Panetta said. The suspect, 38, suffered traumatic brain injury in 2010 after a vehicle rollover accident in Iraq, though he later was deemed "fit for duty".
Panetta said the suspect had "family problems," possibly related to trouble in his marriage, before deploying for the fourth time.
"I think when you look at that larger picture, it does make clear that these kinds of events are isolated and don't represent what's really happening in Afghanistan," he was quoted as saying by the military Star and Stripes newspaper.
Meanwhile, Commander of the US and North Atlantic Treaty Organisation forces in Afghanistan General John Allen has said that the soldier responsible for this would be held accountable.
"We're investigating it aggressively and we will hold the individual accountable should the evidence point to his culpability here," he said.
"I won't go into the specifics of his actions, it would appear that he acted as an individual and did, in fact, shoot a number of Afghan civilians, causing fatalities as many as 16, a number of others were wounded," he said.
He offered his sincere condolences and regrets to the victims of the shooting, to the Afghan families and certainly, to the noble Afghan people as a group. "This is tremendously regrettable," he said.
"The evidence at this point, both in terms of observations and reports and interviews, lead us to believe that he acted as an individual at this point," he said, adding that the investigation is being done under his command.
"A search party was being put together immediately. There was a head count done among the American soldiers recognised that he was missing, unaccounted for. We put together a search party right away and it was as that search party was forming that we began to have indications of the outcome of his departure," he said.
Allen observed that it is really important to understand that the relationship that the American people have and the ISAF troops, the 50 nations of ISAF, have with Afghanistan is a deep relationship, forged over years and years of combat.
"There's a lot of resilience in this relationship and we're seeing that today. Afghan leaders took charge immediately in the aftermath of this event. And exerted, I think, extraordinary leadership, both in leading the people through the tragedy, but also, in setting the conditions ultimately, for the ability to do a good investigation," he said.
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