The key stakeholders of the Finnish engineering education collaborated during 2006-09 to reform the system of education, to face the challenges of the changing business environment and to create a national strategy for the Finnish engineering education. The work process was carried out using participatory work methods. Impacts of sustainable development (SD) on engineering education were analysed in one of the subprojects. In addition to participatory workshops, the core part of the work on SD consisted of a research with more than 60 interviews and an extensive literature survey. This paper discusses the results of the research and the work process of the Collaboration Group in the subproject of SD. It is suggested that enhancing systematic dialogue among key stakeholders using participatory work methods is crucial in increasing motivation and commitment in incorporating SD in engineering education. Development of the context of learning is essential for improving skills of engineering graduates in some of the key abilities related to SD: systemic- and life-cycle thinking, ethical understanding, collaborative learning and critical reflection skills. This requires changing of the educational paradigm from teacher-centred to learner-centred applying problem- and project-oriented active learning methods.