Hey!
Unreal Engine 4 can use sprite sheets for flip books and individual sprites.
Flip books are for simple 2D animations. Individual sprites can be placed on a level.
I recommend checking out the tutorials on youtube since they are very good.
But here is how to create a sprite from your texture:
Click to Edit Source Region:
Here you will be able to select regions from your texture that will be rendered.
Then you can select individual sprites from your sprite sheet:
The result is a standalone sprite that now you can use:
Yep, You have to do this for each sprite or if your sprite is well separated you can use the extract sprites feature which automatically extracts the individual sprites.
I hope it helps 