The purpose of this paper is to introduce the reader to the discipline that is known as mechatronic system engineering, also referred to as mechatronics. This paper discusses one way to define, decompose, design, and specify a mechatronic system. Each company, based upon their unique situation, will have slightly different processes or terms, but the basic steps will be the same. The method discussed in this paper will include hardware/software decisions—including mechanical hardware. It also gives a detailed discussion of the process of concurrent engineering of a complex system, and how to properly decompose and then integrate many components.