Could you please send us a sample project which demonstrates that behavior? You can do so in a new support ticket. We will also appreciate some additional information about the panel bar style you currently use.
I would suggest downloading the Q1 SP1
version of RadControls for WinForms as we have fixed many issues related to RadPanelBar since the Q1 release.
Anyway, it is normal that your list box is not sized to the full size of the panelbar group, because you could put more controls in the group's panel.
I'll be looking forward for your reply and your sample project.
the Telerik team