Abstract: Existing studies underestimated the philosophical value of Critical Outline of National Economics because of the negative evaluation of Engels for specific needs in a specific period in his later years. It is urgent to deeply investigate the core clue of competition and reconstruct the “philosophical reflection of competition” shown by Engels in his text. It could help us to have a deeper understanding of Engels’ criticism of national economics. Private ownership ensured that the law of competition played a role, and the competition itself also depended on private ownership. Within this framework, monopoly and competition generated each other. The contradiction contained in the competition was that it tore the identity of the subject and made the subject fall into infinite self-contradiction, which could not be reconciled. Engels revealed that the competition advocated by national economists was a “self-interest” behavior dressed in the cloak of “mutual benefit”. Competition brought the opposition between man and nature and between man and man, resulting in the dehumanizing cognition of man. The Outline had profound practical enlightening significance.