This study looks at how AI-assisted innovation challenges affect students' engagement and creativity. It shows that students become more interested in learning when they take part in AI-based activities. These activities help them think creatively and solve problems. AI tools make learning more practical and interactive. Students can understand concepts better and apply them in real life. The study also finds that participation in AI challenges increases students' motivation. It helps them feel more confident and active in learning. AI-based learning creates a more engaging classroom environment. However, proper guidance from teachers is important. Overall, the study shows that AI improves engagement, creativity, and learning experience.