In light of the rapid technological shifts driven by the Fourth Industrial Revolution (Industry 4.0), engineering higher education (EHE) must evolve by incorporating emerging digital technologies into curricula and pedagogy. Faculty members are key players in this evolution. In order to incorporate these new disruptive digital technologies in their teaching practice they must be able to adapt. This study investigates how engineering faculty members perceive their competencies in incorporating Industry 4.0 technologies (I4.0T) into teaching practice and how they see the concomitant opportunities, challenges, and needs. The data were collected from 107 faculty members at engineering faculties and universities in Israel. The findings reveal that while many faculty members recognize the value of I4.0T for student engagement, skill development, and future employability, a substantial proportion report insufficient knowledge to form an opinion, limited perceived competence, and a lack of clear strategies for effective incorporation. Key barriers identified include high workloads and inadequate infrastructure. On the other hand, many faculty members cited their desire to impart knowledge and skills to their students as well as the incentive for personal development as intrinsic strengths that can support I4.0T incorporation. The study highlights critical institutional measures such as ready-made educational tools, personal guidance, and professional development that can support a successful transition toward I4.0-aligned engineering education. These findings point to actionable recommendations for policy and practice in engineering higher education.