During world creation, advanced options allow players to modify gameplay dynamics, such as tool and machine efficiency, inventory capacity, and whether procedural generation is enabled—effectively creating an infinite universe.

Once in-game, the player controls a customizable astronaut, known as a "Space Engineer," equipped with tools including a drill, welder, and grinder (if enabled).

Players can create grids by placing blocks freely in open space, which form the basis of ships, stations, or other constructs.

Players can create three types of structures: Grids are classified as small or large based on initial block size.

Ships can be moved and rotated as long as they have power, a gyroscope, a thruster system, and a cockpit or remote control block.

For effective movement and stabilization, thrusters must be placed in all six directions, and inertia dampeners can be enabled to assist in stopping motion automatically.

Astronauts can move freely in all environments using a jetpack, which allows for six degrees of motion: forward, backward, up, down, left, and right.

While asteroids lack gravity, planets and moons feature natural gravitational fields that affect players and ships.

Resources are spread out, and due to planetary gravity and the inefficiency of ion engines within the atmosphere, the player must build ground-based alternatives.

This mode eliminates the survival aspect of the game, allowing players to implement ideas quicker and easier.

In survival mode, players need to mine, collect, and refine various chemical elements from asteroids and planets in order to craft tools, weapons, and blocks as well as produce electricity.

Damage can be inflicted on the player by collisions, weapons, contact with thrusters, meteor showers, or by running out of space suit energy.

In single-player mode, players can explore and build independently within their world, focusing on creative construction or survival challenges by themselves.

Space Engineers features modding capabilities, allowing players to customize and enhance their gameplay experience.

The game supports user-created modifications, including new blocks, tools, scripts, environments, and entirely new gameplay mechanics.

These signals spawn randomly within a certain range of the player, and indicate the position of a small probe via a GPS coordinate and a repeating tone.

Each probe also possesses a button, which when pressed has a chance to reward the player with a collectible skin, similar to a loot box.

Volumetric objects are structures composed from block-like modules interlocked in a grid and match the scale of the player character.

[14] On March 24, 2014, Keen Software House announced that two key milestones in the development of Space Engineers have been achieved: survival mode and multiplayer.

Space Engineers officially released out of early access on February 28, 2019, alongside The Survival Overhaul Update.