I made sense all of a sudden of several comments in different threads, plus my own trying. It took me a while though, so thought it was a good idea to write an How To.
Here's the short story:
* you need to have YubiClip installed on the phone (free download on Google Play), it does the job of transferring the infos from your Yubikey to LastPass; once installed, it works in the background, so no further action needed;
* Open Lastpass, it should ask for your standard password, then it will open the authentication form, and it is waiting for you to swipe the NEO next to your phone; (also swiping you Yubikey to the back of the phone opens up Lastpass, but you might end up keying in your password or swiping twice)
* when you place the Yubikey next to the back of the phone, it is not obvious that YubiClip gets its infos correctly. If you hear a two-tone, that signals an error;
* try different positions, from flat to the back of the phone, to about one cm away (1/3 of an inch), up & down, until you hear a single tone sound. that means the YubiKey has delivered the infos and the phone interpreted them properly.
* If everything went fine, Lastpass' authentication form will close, and it will decrypt your vault.
This is being taken for granted: that you already followed three tutorials on lastpass and yubico websites, and you did set up your Yubikey NEO properly, i.e.:
https://helpdesk.lastpass.com/security-options/multifactor-authentication-options/yubikey-authentication/#How+to+use+LastPass+with+YubiKey+NEO general Lastpass tutorial to set up a new yubikey in Lastpass (you hopefully already know that you need Lastpass Premium to use a Yubikey)
https://enterprise.lastpass.com/getting-startedmultifactor-options/yubikey-authentication/#Watch+How+to+use+LastPass+with+YubiKey+NEO Additional steps to set a Yubikey NEO (including instructing Lastpass not to access your vault without Yubikey also from your smartphone)
http://www.yubico.com/products/services-software/personalization-tools/use/ this is the personalization tool to set up the Yubikey to be used for lastpass
Hope this serves someone.
