This is part one of a series of three papers examining engineering education in Egypt provided by state (government funded) universities. There have been concerns from all stakeholders about the graduates’ knowledge and skills. A number of authors have described the chronic problems with higher education in Egypt in general, but this work provides insights and a fresh perspective at the phenomenon. In this manuscript, the institutions are analyzed from a business perspective in order to identify the underlying causes of the problems observed. The structural, operational and environmental (both external and internal) challenges that lead to the current status are described. The analysis highlighted several constraints that hinder radical reforms. In part two of this series the aspirations of stakeholders were collected. In part three, suggested measures are outlined based on the experiences of engineering education providers worldwide. These measures can be applied within the current constraints. The recommendations are hoped to realise the aspirations of the stakeholders. Collectively, the three parts provide insight in present practices and draw plans for improvement.