Panzerhund was one of the first prototype robots to come out of General Deathshead's workshop. According to a newspaper article found in-game, it was first deployed on the Eastern Front, creating chaos along the Russian ranks as it tore through the battlefield.

Initially despite the introduction of the Panzerhund, the most common German canine unit to be seen on the battlefield in the Western theaters during the late 40s was the Kampfhund; the Panzerhunde encountered in 1946 by B.J. Blazkowicz appeared during the crash landing upon the beaches of Deathhead's Compound, before he and the other remaining Allied troops scaled the castle walls. Despite their appearance and apparent invulnerability to most attacks, they are taken out by B.J. using an anti-aircraft gun. Upon exiting the bunkers surrounding Deathshead's castle, B.J. is attacked and nearly killed by a Panzerhund, but is saved when Private Probst Wyatt III tricks the beast into catching a live grenade in its mouth, destroying it.

Controls:

Throttle:Move forward(and yes, it has working legs)
Roll:Move head
Yaw:Turn
VTOL:Fire breathing module(Doesn’t do damage for safety reasons)

I may or may not have copied and pasted this passage from Wolfenstein Wiki...