63 vw beetle axel

I just replaced my original engine with a new 1600. After the engine was put in and while the car was off the ground I noticed when I turn one rear tire one way the other rear tire goes in the other direction.

Does this mean there is something else wrong or did I screw up something when I put he new engine in?

That is a limited slip differential. This is so for most any car.

Actually it indicates that it's not limited slip, but it's normal anyway.