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Engineers will routinely work in teams to solve complex problems. Team-working and collaboration are therefore an integral part of engineering education as they offer enhanced opportunities of acquiring both transferable and subject-specific skills. This paper examines the experiences of third-year engineering students studying a designbased module which uses problem-based learning (PBL) as the main pedagogical approach where students work in teams of 5 or 6 to achieve the associated learning outcomes. PBL allows students to not only play an active role in their own learning but also affords the added opportunity of learning with and from each other (peer learning). The success of this experience can however, be impacted by the team efficacy which exists or ensues as part of the process. These interactions can influence academic self-efficacy and a key aim of this paper is to use the students' perceptions of their experiences with PBL to examine the relationships which exist among academic self-efficacy, peer learning and team efficacy within the module. Findings show that a large percentage of students (85%) felt they learned from each other and that this collaborative experience strongly improved their understanding of mechanical design principles. Self-efficacy scales ranging from 0 (cannot do at all) to 100 (highly certain can do) showed that 65% of students rated their average academic self-efficacy across all learning outcomes as high (above 75). This efficacy was positively related to the support received from peers. Only 6% of respondents indicated that they would be confident undertaking the module by themselves and that while peer-to-peer interactions helped with sharing the workload and producing deliverables, they would have been able to successfully tackle the module alone had the time allotted been increased proportionally. This information is valuable as it can inform and direct future module design within our programme in which many modules are team-based. This could involve and lead to the introduction of new- and the strengthening of existing peer learning opportunities which could transform the way we teach and learn in our department. [ABSTRACT FROM AUTHOR]