Employee engagement is a key business driver for organizational success. In a world that is changing both in terms of the global nature of work and the diversity of the workforce, engaged employees may be a key to competitive advantage. Companies that understand the conditions that enhance employee engagement will have accomplished something that Competitors will find very difficult to imitate, and the purpose of this research is to find out the degree of employees’ perception on employee engagement in engineering industry, Vijayawada. And to analyze the factors which are predominant in influencing the employees positively towards employee engagement. The opinions of employees are collected by a standard questionnaire of Gallup’s study on employee engagement. Apart from demographic analysis, the reliability of sample was tested by using Kaiser-Meyer-Olkin Measure of Sampling Adequacy and the factor analysis was conducted , the results shows that conducive work environment, optimistic attitude, effective supervisor, core values, organizational relationship, and career development are indispensable to motivate the employee engagement, implications are discussed and recommendations are offered for improving the employee engagement. Key Word: Engaged Employees, Core Values, Optimistic Attitude, Effective Supervisor, Career Development.