Taking up to 300 Chinese and Japanese listed corporations in electricity machinery industry from 2000 to 2006 as the sample, this study use SFA and DEA respectively to measure those companies' technical efficiency, and the estimates show that a serious low-level average firm efficiency exists even in highly competitive electricity machinery industry in China and Japan. It then employs the panel data random-effect model to make an explosive test on the nexus between firm efficiency and firm value on the premise of control variables such as operating performance, firm size, financial leverage, structure of shareholder and product market are introduced into this model. Our empirical results verifies that there is a tight, positive and significant linkage between firm efficiency and firm value in Japanese sample. And the elasticity of firm efficiency to firm value is about equal to 0.3. However, this study cannot find a similar linkage in Chinese electricity machinery industry.