Go into your rourter's settings and set Wireless Encryption to WPA. Choose a nice long random key.
Then set the same settings on your laptop's wireless settings.
BTW you may want to remind your neighbour that what he/she is doing is illegal in the UK and the police have seized computers an brought charges for stealing people's bandwidth. The Police take the view that just because you have left your door open it is not an invitation to steal your property.
T, December 2008