Many climate-controlled agricultural buildings use direct gas-fired circulating heaters (DGFCH) for supplement heat. There is no standardized test to calculate thermal efficiency for these heaters. This study aimed to develop a measurement system and analytical analysis for thermal efficiency, quantify the measurement uncertainty, and assess economics of DGFCH efficiency. The measurement system developed was similar to the ASHRAE 103 standard test stand with adaptations to connect the apparatus to the DGFCH. Two different propane measurement systems were used: input ratings < 30 kW used a mass flow system and input ratings > 30 kW used a volumetric gas meter. Three DGFCHs (21.9, 29.3, 73.3 kW) were tested to evaluate the system. Thermal efficiencies ranged from 92.4% to 100.9%. The resulting uncertainty (coverage factor of 2; ~95% Confidence Interval) ranged from 13.1% to 30.7% for input ratings of 56.3 to 11.4 kW. Key sources of uncertainty were propane and mass flow of air measurement. The economic impact of 1% difference in thermal efficiency ranged from USD $61.3 to $72.0 per heating season. Refinement of the testing system and procedures are needed to reduce the uncertainty. The application of this system will aid building designers in selection of DGFCHs for various applications.