The need to refuel future missions to Mars and the Moon via in situ resource utilization (ISRU) requires the development of LOX/LCH4 engines, which are complex and expensive to develop and improve. This paper discusses how the use of digital engineering—specifically physics-based modeling (PBM)—can aid in developing, testing, and validating a LOX/LCH4 engine. The model, which focuses on propulsion performance and heat transfer through the engine walls, was created using Siemens’ STAR-CCM+ CFD tool. Key features of the model include Eulerian multiphase physics (EMP), complex chemistry (CC) using the eddy dissipation concept (EDC), and segregated solid energy (SSE) for heat transfer. A comparison between the complete GRI 3.0 and Lu’s reduced combustion mechanisms was performed, with Lu’s mechanism being chosen for its cost-effectiveness and similar output to the GRI mechanism. The model’s geometry represents 1/8th of the engine’s volume, with a symmetric rotational boundary. The performance of this engine was investigated using NASA’s chemical equilibrium analysis (CEA) and STAR-CCM+ simulations, focusing on thrust levels of 125 lbf and 500 lbf. Discrepancies between theoretical predictions and simulations ranged from 1.4% to 28.5%, largely due to differences in modeling assumptions. While NASA CEA has a zero-dimensional, steady-state approach based on idealized conditions, STAR-CCM+ accounts for real-world factors such as multiphase flow, turbulence, and heat loss. For the 125 lbf case, a 9.2% deviation in combustion chamber temperature and a 15.0% difference in thrust were noted, with simulations yielding 113.48 lbf compared to the CEA’s 133.52 lbf. In the 500 lbf case, thrust reached 488 lbf, showing a 2.4% deviation from the design target and an 8.6% increase over CEA predictions. Temperature and pressure deviations were also observed, with the highest engine wall temperature at the nozzle throat. Monte Carlo simulations revealed that substituting LNG for LCH4 affects combustion dynamics. The findings emphasize the need for advanced modeling approaches to enhance the prediction accuracy of rocket engine performance, aiding in the development of digital twins for the CROME.