This document is the final report of the National Science Foundation's Blue Ribbon Panel on Simulation-Based Engineering Science (SBES). The report finds that SBES has become an indispensable tool for solving scientific and technological problems and recommends ways to advance SBES through academia, industry, national laboratories, and government agencies. Key challenges discussed include multiscale modeling, verification and validation, big data and visualization techniques, and education initiatives to prepare engineers and scientists for the knowledge explosion enabled by SBES. The report highlights promising applications of SBES in medicine, homeland security, energy/environment, materials, and industrial/defense fields.