The pano was taken handheld because I was climbing up a snow mountain (Haba snow mountain in Yunan China) and it would be too heavy to lug along a tripod.
This is how it was taken:
1. Set my zoom lens to around 50mm equivalent to get the minimum distortion. This step is very important, otherwise barrel distortions will be present in the frames and the stitching program will need to corret them, making the stitching process more erratic. This step will also help reduce light fall off at the corners.
2. Set the camera (s2pro) to aperture priority with an appropriate aperture, and matrix metered a frame where the lighting condition is in mid tone. Set the camera to manual mode and set the aperture & shuttle according to this. If the camera is left at the auto exposure mode (either aperture priority/shuttle priority/program) the camera will try to expose each frame in mid tone, causing tonal incompatibility across the frames.
3. Held up the camera in portrait mode and panned around to check both the exposure setting and the composition, making sure the horizon was about level and there were enough rooms above & below the frames.
4. The trick for panning is to hold the camera against your forehead and just twist your waist around or turn with your legs, without much movement to the upper body.
5. Start taking the frames once the settings were ok, making sure there were enough overlaps among adjacent frames.
6. After stitching, PS was used to make minor adjustment to the horizon (provided it is not way out, of course), and then cropped away the unwanted parts.
That's all to it.
Here is another sample, also taken handheld with my S2pro but was stitched with Canon G2 stitching program (click to enlarge):
(Btw, this one was taken in Nepal. Everest is right at the middle of this picture at the furthest background.)
Cheers.