This study explores the opportunities and challenges of integrating artificial intelligence (AI) into engineering education. Through a review of the literature and a qualitative focus group study, an assessment was made for the role of AI in personalizing learning, enhancing simulation engagement, providing real-time feedback, and preparing students for AI-integrated workplaces. The study emphasizes how AI may significantly improve educational experiences by making them more dynamic, interactive, and successful. It also draws attention to important issues, such as moral questions, algorithmic biases in AI, infrastructure constraints, the need for AI literacy training for educators, and a range of student perspectives on AI engineering education. The results support a systematic approach to AI integration, highlighting the necessity of cooperative efforts by educators, legislators, curriculum designers, and technologists in order to overcome these obstacles. The study makes the case that AI can transform engineering education by negotiating these challenges and providing students with the information and skills needed for the digital future, all the while assuring fair and moral access to technology-enhanced learning.