We present a thermal and chemical model of the neutral envelope of planetary nebula NGC 7027. In our model, the neutral envelope is composed of a thin dense shell of constant density and an outer stellar wind region with the usual inverse-square law density proÐle. The thermal and chemical structure is calculated with the assumption that the incident radiation Ðeld on the inner surface equals 0.5 ] 105 times DraineÏs Ðt to the average interstellar far-ultraviolet Ðeld. The rate coefficient for formation on H 2 grains is assumed to be the usual value to take into account the lower dust-gas mass ratio in the 1 5 neutral envelope of NGC 7027. The calculated temperature in the dense shell decreases from 3000 to under 200 K. Once the temperature drops to 200 K, we assume that it remains at 200 K until the outer edge of the dense shell is reached, so that the observed intensities of CO J \ 16È15, 15È14, and 14È13 lines can be reproduced. The 200 K temperature can be interpreted as the average temperature of the shocked gas just behind the forward shock front in the framework of the interacting stellar wind theory. We calculate the intensities of the molecular far-infrared rotational lines by using a revised version of the escape probability formalism. The theoretical intensities for rotational lines of CO (from J \ 29È28 to J \ 14È13), CH`, OH, and CH are shown to be in good agreement with ISO observations. The H 2 rovibrational line intensities are also calculated and are in agreement with available observations.