Headphones are not the only ones fitted with noise cancelling technology. Earphones such as the panasonic noise cancelling earphones have tiny circuitry in them that cancels out ambient sounds despite their small frame and build.
Headphones and earphones that cancel noise and other unwanted background sounds commonly use a technology called active noise control. The active noise control circuitry is built into each right and left unit of the headset. It is composed of tiny microphones that emit signals, electronics that utilize the microphone signal and produce an “anti-noise” signal, and a speaker driver that emits the anti-noise signal to produce destructive interference. This phenomenon is what cancels out the ambient noise around the environment, and creates a pocket of silence inside the headphones.
This technology that is used in headphones and Panasonic noise cancelling earphones make it possible to enjoy silence inside a noisy environment while travelling, and enables you to enjoy listening to music without trying to pump up its levels.
Earphones like Panasonic noise cancelling earphones produce all of that despite its tiny build. While most headphones are built in a circumaural manner (enclosing the ears completely), earphones are placed inside the entrance of the ear canal, just one or two centimetres away from the eardrum. The anti-noise signal is transmitted in the enclosed space between the earphone and the eardrum, so it achieves the same effect as with an ordinary headphone. 
In some respects, earphones like the Panasonic noise cancelling earphones achieve better noise cancelling results than headphones. You can still use it to enjoy reduced noise and increased silence.
Active noise cancellation technology has its drawbacks however. One major disadvantage of this is that it is not able to cancel out higher frequency sounds, such as human speech, rapidly changing sound signals, and high pitched sounds. In order to truly cancel out sounds of high frequencies, the anti-noise emitter will have to be placed adjacent to the eardrum to be effective. This is obviously impractical and technically not feasible.
However, with the Panasonic noise cancelling earphones, higher frequency sounds can be somewhat cancelled. This is because the ear units are placed closer to the eardrums than anti-noise units of headphones. This is why earphones can be more effective noise cancellers than headphones because of this technicality. Together with the noise blocking rubber foam completely plugging the ear canal and creating a soundproof room inside the canal, panasonic noise cancelling headphones are very effective in soundproofing and blocking out unwanted ambient noise.
