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This paper presents a wearable module and neural-network-based activity classification algorithm for energy expenditure estimation. The purpose of our design is first to categorize physical activities with similar intensity levels, and then to construct energy expenditure regression (EER) models using neural networks in order to optimize the estimation performance. The classification of physical activities for EER model construction is based on the acceleration and ECG signal data collected by wearable sensor modules developed by our research lab. The proposed algorithm consists of procedures for data collection, data preprocessing, activity classification, feature selection, and construction of EER models using neural networks. In order to reduce the computational load and achieve satisfactory estimation performance, we employed sequential forward and backward search strategies for feature selection. Two representative neural networks, a radial basis function network (RBFN) and a generalized regression neural network (GRNN), were employed as EER models for performance comparisons. Our experimental results have successfully validated the effectiveness of our wearable sensor module and its neural-network-based activity classification algorithm for energy expenditure estimation. In addition, our results demonstrate the superior performance of GRNN as compared to RBFN.