Historically, science and engineering have been closely related, sometimes indistinguishable, disciplines. Scientists set out to understand and explain nature, the goal of their efforts being the answer to the questions such as "Why is the sky blue?" or "What causes cancer?"
Engineers either try to create things that don't exist in nature (e.g., a nuclear powered submarine or a mechanical heart) or improve on a previous design (e.g., the Ford Mustang over the Model T). Scientists accomplish their goals via rigorous adhesion to the scientific method. Engineers also have a "scientific method," referred to as the "development process."
This begins with an idea of how to make something "better" (i.e., more cost effective to produce, safer, stronger, easier to use) or create (invent) something that fulfills a need in society. Then a systematic process involving testing and design modification continues until the goals of the project are met. The "tools" that an engineer uses to achieve her/his goals are provided by the scientists (e.g., physical laws via scientific investigation) and mathematicians. The most important tool, however, is the special quality known as "engineering intuition," i.e., the "I think this will work" part of development.
In general, a successful engineering project demonstrates creativity, originality, ingenuity and a well organized, systematic design and development process. The student doesn't have to prepare a functioning example of his/her design! Rather, the student should be prepared to demonstrate the feasibility of the design. A judge should come away from the student's project thinking "That's a really neat idea," with the impression that the project was well thought-out and the job was thorough.
Refer to the engineering section of the Science Fair Rule Book for the steps to develop an engineering project.