Surface subsidence as an inevitable consequence of underground mining can cause problems for the environment and surface structures. Subsidence due to mining two shallow panels from an inclined coal seam C1 of the Parvadeh (Tabas) coalfield, located in the eastern part of Iran, was predicted by finite difference method (FDM) using FLAC3D software. The predicted subsidence profiles were compared favourably with both the measured values as well as the profile functions method. Using the parametric analysis, the position of maximum subsidence area was predicted over the panel rise side, which was completely in contrast with deep coal seam mining. The range of critical width to depth ratio (W/H) for both panels was determined between 1.0 and 1.4.