Cerro Quema is a high-sulfidation epithermal Au-Cu deposit located in the Azuero Peninsula, southwestern Panama. It is hosted by a dacite dome complex of the Río Quema Formation, a volcano-sedimentary sequence of the Panamanian Cretaceous-Paleogene magmatic arc. Cerro Quema has oxide resources of 24.60 Mt at 0.71 g/t Au and 0.04% Cu, and sulfide resources of 11.38 Mt at 0.41 g/t Au and 0.31% Cu. Alunite 40Ar/39Ar dating of a sample from Cerro Quema yielded a final age of 48.8 ± 2.2 Ma (weighted average of plateau age) and 49.2 ± 3.3 Ma (weighted average of total gas age). This age is interpreted to represent the formational age of the Cerro Quema deposit at ~49 Ma, linking it to the Valle Rico batholith intrusive event. Based on the new alunite 40Ar/39Ar data and a reexamination of published geochronological data, magmatic-hydrothermal deposits such as the Río Pito porphyry copper and the Cerro Quema high-sulfidation epithermal deposit formed during the early arc stage (68–40 Ma) in the Chagres-Bayano arc (eastern Panama) and the Soná-Azuero arc (western Panama), respectively. They formed in a similar geodynamic setting at ~49 Ma, when diorites and quartz-diorites intruded Cretaceous volcano-sedimentary sequences. Cerro Quema and Río Pito provide evidence for the exploration potential of Cretaceous-Paleogene arc segments. Exploration should focus on Cretaceous volcanic and volcano-sedimentary sequences intruded by Paleogene batholiths of intermediate to felsic composition.