Results from a 60 ks Chandra HETGS observation of the nearby Seyfert 2 Circinus are presented. The spectrum shows a wealth of emission lines at both soft and hard X-rays, including lines of Ne, Mg, Si, S, Ar, Ca, and Fe, and a prominent Fe Kalpha line at 6.4 keV. We identify several of the He-like components and measure several of the Lyman lines of the H-like ions. The lines profiles are unresolved at the limited signal-to-noise ratio of the data. Our analysis of the zeroth-order image in a companion paper constrains the size of the emission region to be 20-60 pc, suggesting that emission within this volume is almost entirely due to the reprocessing of the obscured central source. Here we show that a model containing two distinct components can reproduce almost all the observed properties of this gas. The ionized component can explain the observed intensities of the ionized species, assuming twice-solar composition and an N propto r^{-1.5} density distribution. The neutral component is highly concentrated, well within the 0.8arcsec point source, and is responsible for almost all of the observed Kalpha (6.4 keV) emission. Circinus seems to be different than Mkn~3 in terms of its gas distribution.
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