How do I change the MTL File to an actual image? When exporting my Model and importing it into another engine, It require an Image file as the texture instead of a MTL file, so I was just wondering how I would accomplish changing the mtl to and image file
A MTL file is just a material definition. It doesn't contain image data. See here for further (all) details about the MTL file format: http://paulbourke.net/dataformats/mtl/

If you're using OBJ files, you need three things:


the model data as OBJ, contains vertices, faces, smoothing groups and texture coordinates, etc.
the texture(s) (any image format, e.g. PNG)
the material library file (which is referenced in your OBJ file)


See also:


the blender manual about the OBJ file format 
this question for OBJ exporting options in Blender