Engel began his playing career at BSG DIMO Böhlitz-Ehrenberg in a suburb of Leipzig, before moving on to DDR-Oberliga side BSG Chemie Leipzig. Here he played for the youth team, but already had to end his playing days without playing a single senior game due to prolonged back problems.
Engel took up managing immediately after his playing days had come to an end, working as a youth coach for Chemie Leipzig until 1976, when he found work with the Deutscher Fußball-Verband, the East German football association. He coached the youth national teams, from the Under 15 to the Under 19. Altogether, he was in charge of a national team for 195 matches, and coached later stars such as Matthias Sammer, Ulf Kirsten and Thomas Doll. In 1988 his team won the bronze medal at the Umder-16 European Championship in Spain. The East Germans beat their West German counterparts under Holger Osieck in the third-place playoff.