The prefrontal cortex (PFC) is involved in adaptive control of behavior and optimizing action selection. When an organism is experiencing an aversive event, such as a sustained state of anxiety or an overt experience of fear or stress, the mechanisms that govern PFC regulation of action selection may be critical for survival. A large body of literature has shown that acute aversive states influence the activity of PFC neurons and the release of neurotransmitters in this region. These states also result in long-term neurobiological changes in the PFC and expression of PFC-dependent motivated behaviors. The mechanism for how these changes lead to modifying action selection is only recently beginning to emerge. Here, we review animal and human studies into the neural mechanisms which may mediate the adaptive changes in the PFC that emerge during negative affective states. We then highlight recent advances in approaches for understanding how anxiety influences action selection and related cortical processes. We conclude by proposing that PFC neurons selectively influence action encoding during conditions where actions toward obtaining a reward or avoiding harm are executed under a fog of fear and anxiety.