The physical and chemical processes responsible for neutral gas heating resulting from energetic electron bombardment of the atomsphere are quantitatively described. The neutral heating efficiency, defined as the local heating per unit energy deposition, is evaluated for a range of typical auroral electron spectra, and it is shown that the altitude profile of the efficiency is independent of the electron spectrum. The efficiency is sensitive to the neutral atmosphere (composition, density, temperature) but differences can be minimized by adopting a pressure coordinate in place of the altitude. Over half the energy input rate associated with energetic particle precipitation goes into neutral heating, while less than 5% leads to ion heating. The coupling between particle precipitation and joule heating is discussed, and a parameterized Pedersen conductance curve is presented.