The origin of the soft X-ray emission in obscured AGN was still largely 
unknown before the launch of XMM-Newton and Chandra. However, important 
progresses have been made thanks to their high energy and spatial 
resolution. We review here the latest results on this issue, focusing on 
the physical properties of the material responsible for the soft X-ray 
emission and its relation to the circumnuclear environment. In 
particular, we show that all pieces of evidence point to a scenario, 
where this gas is photoionized by the AGN and is spatially coincident 
with the optical Narrow Line Region.