AbstractInteractions between the incident solar wind plasma and lunar crustal magnetic fields can lead to modifications in electron and ion dynamics that can result in the generation of electrostatic and electromagnetic waves. The resulting waves can then interact with the ambient electrons, leading to perpendicular and/or parallel electron heating. We analyze 10 years of data from the Acceleration, Reconnection, Turbulence, and Electrodynamics of Moon's Interaction with the Sun mission, when the spacecraft was within 200 km of the dayside lunar surface and within the solar wind, in order to characterize the near‐Moon plasma environment. We find that as the reflected ion density increases, electrostatic waves associated with plasma conditions favorable for the electron cyclotron drift instability play an increasingly important role in perpendicular electron heating, while electromagnetic interactions display the opposite trend. Additionally, we find that electrostatic waves associated with parallel heating exhibit plasma characteristics that are consistent with both the electron two‐stream instability and the modified two‐stream instability.