Performance efficiency of educational institutions should be constantly scrutinized and improved to make sure that competent manpower and researchers are produced proficiently in meeting the institutional standard of intellectuals. With a systematic performance evaluation system, resources can be directed satisfactorily and tasks may be completed effectively. Performance evaluation and ranking of engineering departments of technical institutions have received very limited attention due to complexity and difficulty in measuring the outputs. However, in today’s global education system, performance evaluation of engineering departments is required to assess whether they meet the set objectives and foster an environment of continuous improvement. So, the objective of this paper is set to develop a multi-criteria decision-making framework for performance evaluation and ranking of 16 engineering departments in an Indian university which addresses the inter-relationships between the selection criteria with the aid of decision-making trial and evaluation laboratory (DEMATEL) method while building a relationship structure. Entropy method is used to determine the relative criteria weights, and finally, a compromise ranking method is applied to prioritize and rank those departments. It is observed that Electrical Engineering department emerges out as the best performer and Information Technology department lags behind in its performance. Based on analytical results, faculty/student ratio, infrastructural development, student results and international research publications are identified to play major roles in evaluating the performance of those departments. This integrated model can help practitioners to improve their decision-making process, especially when criteria are numerous and interrelated. Its relevance and implementation issues in context of Indian engineering education scenario are also discussed.