This paper discusses a series of introduction to mechanical engineering challenges developed and implemented to increase student retention and engagement in a freshman engineering course. Studies have shown that freshman or sophomore intellectual experiences play a decisive role in Science, Engineering and Mathematics (SEM) student retention and that minority SEM students, among others, leave SEM undergraduate fields in part due to lack of real world connections to their classroom learning experiences. Introduction to Mechanical Engineering is a course that introduces mechanical and civil engineering students to the engineering college education and profession. The challenge-based instruction (CBI) curriculum developed for Introduction to Mechanical Engineering includes challenges, lecture and handout materials, hands-on activities, and assessment tools. CBI is a form of inquiry based learning which can be thought of as teaching backwards strategy. When implementing CBI, a challenge is presented first, and the supporting theory required to solve the challenge is presented second. CBI was built around the How People Learn (HPL) framework for effective learning environments and is realized and anchored by the STAR Legacy Cycle, as developed and fostered by the VaNTH NSF ERC for Bioengineering Educational Technologies. The CBI instruction was developed and implemented in the areas of reverse engineering, statics, dynamics, energy (including renewable energy), and forward engineering. Additionally, the paper describes the initial impact of the CBI curriculum on the students, including initial assessment results, and the impact on the faculty and the course. A controlled experiment was performed with a control group following a more traditional laboratory setup. From the initial positive results obtained in this project, it is argued that the VaNTH principles are effective in motivating and engaging freshman engineering students in mechanical and civil engineering majors and that the CBI materials and tools developed for this course could support other institutions' efforts in student attraction, retention, and engagement. This project was supported by a College Cost Reduction and Access Act (CCRAA) grant from the Department of Education that focuses on student retention and development of adaptive expertise.