What innovation defined the revolution that rendered the atmospheric engine obsolete for high-power applications?

Introduction of compression before ignition.

The defining technological leap that pushed the atmospheric engine design into obsolescence for mobile and high-power uses was the successful implementation of compression prior to combustion. Designs like Lenoir's relied on atmospheric pressure acting on the piston after ignition. The breakthrough came with Nicolaus Otto’s 1876 patent for the Otto Silent Engine, which utilized the deliberate compression of the air/fuel mixture. This increase in pressure dramatically enhanced the thermal efficiency and specific power output of the engine, making the older, uncompressed atmospheric cycle thermodynamically inferior for demanding applications.