In this paper, a high efficiency leakage transformer for neon tube is developed to improve its power factor, to reduce its core loss and weight by using a technique of shape optimization and grain direction of non-oriented silicon steel strip. A protection circuit is designed for all types of neon transformer loaded with one or more neon tubes. Whenever the neon tube fails to be started up or comes to the life end, or encounters faults with open-circuits at the output terminals of the neon transformer, the electronic type protection circuit will be initiated to avoid more critical hazards. These neon transformers need a electronic type protection circuit to prevent from current stresses on circuit components by neon tube fail. The input of the transformer is automatically cut on when the abnormal condition occurs, preventing waste of no-load power.