The competence to innovate is critical for engineering students, as work environments and society are constantly changing. However, innovation competence is often not (explicitly) part of teaching, and teachers struggle to teach students this competence. To address this problem, a course to train undergraduate engineering students' innovation competence was designed, based on six design principles. The instruction was nested in a final-year undergraduate Built Environment course. A mixed-method study (pre- and post-training student survey (n = 46); student focus group interviews (n = 18); teacher individual interview (n = 2); and analysis of student (n = 46) products, as assessed by 12 teachers) was undertaken to understand the effectiveness of the design principles in supporting students' development of innovation competence. Paired samples t-tests showed significant growth in students' self-perceived innovation competence. Analysis of students' innovative products showed that they met the course goals. Students, teachers, and other stakeholders also reported positive perceptions of the setup and design principles used in the innovation competence instruction. The results showed that the intervention as described is effective for improving students' innovation competence in the domains of study. This study offers several starting points for fostering the development of students' innovation competence in higher education organisations.