The aim of this paper is to present a finite element method to predict buckling characteristics of paper honeycomb sandwich panels with composite skins under dynamic axial compression via ANSYS/LS-DYNA. First of all, some problems of the conventional method using honeycomb plate theory, sandwich laminboard theory and equivalent panel theory were pointed out. In order to develop an effective predicting method, by assuming appropriate periodic boundary condition on the edges, a simplified finite element model on hexagonal structure of a unit cell for sandwich panels was developed utilizing the 3D finite element method. The effective Young's modulus of the cellular wall was obtained from the result of the test on the honeycomb core. Several useful conclusions are drawn about the axial crushing of honeycomb sandwich composites and unit cell and can be used to guide the design of composite structures. The paper further attempts to explain numerical results are well consistent with the corresponding experimental ones.