Panucci began his professional career with Genoa in 1990 and made his Serie A debut with the club during the Serie A season of 1991-92. He caught the attention of the Rossoneri and moved to A.C. Milan after his impressive performances during the 1992-93 season, which saw him score 3 goals in 30 appearances. His first season was a stepping stone for him as he was mainly a substitute for Tassotti. However, under manager Fabio Capello, Panucci started to force his way into the starting lineup, featuring in 19 league matches and scoring twice as Milan won domestic and European titles. In the 1994 UEFA Champions League Final, he also showed his versatility by lining up at left-back, while Tassotti played on the right and Paolo Maldini and Filippo Galli in the middle, filling in for the injured Franco Baresi and the suspended Alessandro Costacurta, who were typically the starting central defensive pair of the club.
Christian established himself as the club's first-choice right-back in the following season, seeing him starting 28 of 34 Serie A matches, also earning him a call from the senior national team. Milan had a good start to the season, winning both the Italian Supercoppa and the UEFA Super Cup, but ended fourth in the Serie A. In 1995-96, Panucci had one of his best offensive seasons, scoring five goals, while helping to form the tightest defense in the league, and one of the greatest of all time, alongside Baresi, Maldini, and Costacurta. That same year, Milan were crowned as Scudetto winners. After winning 6 Serie A titles, Panucci left the club for Real Madrid halfway through the 1996-97 season, joining the former A.C. Milan Coach, Fabio Capello. Following the Spanish giants, Christian played for other clubs across Europe such as Chelsea, Monaco, Roma, Parma and a short spell with the other least known club in Milan.
Panucci became a football pundit and match analyst for SKY Italia after his retirement. On 19 March 2012, he left his role as a pundit to accept an offer from Maurizio Zamparini as Palermo team manager, working alongside football director and scouting boss Luca Cattani. However, just over a month after taking up the role, he resigned from his position. Later, Fabio Capello invited Panucci to serve as his assistant whilst working as head coach of the Russian national football team. After the end of the 2014 FIFA World Cup, he left his job and embarked on other managerial posts with Serie B sides Livorno and Ternana. Panucci's last managerial role was as head coach of the Albanian national football team on 19 July 2017. He agreed on a two-year and four-month deal with the Albanian Football Association, replacing fellow Italian coach Gianni De Biasi.