The paper deals with some possible applications of Knowledge Engineering methods to the practical Software Engineering. Such an integration could provide a way to overcome some constant problems present in the contemporary Software Engineering. This paper describes foundations of the HeKatE Project, which aims at incorporating well established Knowledge Engineering tools and paradigms into the Software Engineering domain. A new Hybrid Knowledge Engineering (HeKatE) methodology is proposed, which would allow for faster development of highly reliable software. The HeKatE design process is introduced which offers important capabilities of formal verification, and gradual refinement of software from the conceptual model stage to an executable prototype. An integrated design environment and runtime based on the ARD/XTT concept is also proposed. Furthermore, HeKatE-based applications can be integrated with existing software, designed in a classical way.