diff --git a/README.md b/README.md
index 38a46f56..ec8bfe06 100644
--- a/README.md
+++ b/README.md
@@ -63,6 +63,60 @@ If you prefer to host your own Colanode server, check out the [`hosting/`](hosti
 
 All required environment variables for the Colanode server can be found in the [`hosting/docker/docker-compose.yaml`](hosting/docker/docker-compose.yaml) file or [`hosting/kubernetes/README.md`](hosting/kubernetes/README.md) for Kubernetes deployments.
 
+### Running locally
+
+To run Colanode locally in development mode:
+
+1. Clone the repository:
+
+   ```bash
+   git clone https://github.com/colanode/colanode.git
+   cd colanode
+   ```
+
+2. Install dependencies at the project root:
+
+   ```bash
+   npm install
+   ```
+
+3. Start the apps you want to run locally:
+
+   **Server**
+
+   ```bash
+   cd apps/server
+
+   # Copy the environment variable template and adjust values as needed
+   cp .env.example .env
+
+   npm run dev
+   ```
+
+   To spin up the local dependencies (Postgres, Redis, Minio & Mail server) with Docker Compose, run this from
+   the project root:
+
+   ```bash
+   docker compose -f hosting/docker/docker-compose.yaml up -d
+   ```
+
+   The compose file includes a `server` service. When you want to run the API locally with `npm run dev`, comment
+   out (or override) that service so only the supporting services are started.
+
+   **Web**
+
+   ```bash
+   cd apps/web
+   npm run dev
+   ```
+
+   **Desktop**
+
+   ```bash
+   cd apps/desktop
+   npm run dev
+   ```
+
 ## License
 
 Colanode is released under the [Apache 2.0 License](LICENSE).
diff --git a/apps/server/.env.example b/apps/server/.env.example
new file mode 100644
index 00000000..50401c1e
--- /dev/null
+++ b/apps/server/.env.example
@@ -0,0 +1,74 @@
+# ------------------------------------------------------------------
+# Example .env for Colanode Server
+# Copy this file to ".env" and adjust the values as needed.
+# ------------------------------------------------------------------
+
+# ───────────────────────────────────────────────────────────────
+# General Node/Server Config
+# ───────────────────────────────────────────────────────────────
+NODE_ENV=production
+SERVER_NAME="Colanode Local"
+SERVER_AVATAR=
+SERVER_MODE=standalone          # 'standalone' or 'cluster'
+# SERVER_PATH_PREFIX=
+# SERVER_CORS_ORIGIN=http://localhost:4000
+# SERVER_CORS_MAX_AGE=7200
+
+# ───────────────────────────────────────────────────────────────
+# Account Configuration
+# ───────────────────────────────────────────────────────────────
+ACCOUNT_VERIFICATION_TYPE=automatic   # automatic | manual | email
+ACCOUNT_OTP_TIMEOUT=600               # seconds
+# ACCOUNT_GOOGLE_ENABLED=true
+# ACCOUNT_GOOGLE_CLIENT_ID=
+# ACCOUNT_GOOGLE_CLIENT_SECRET=
+
+# ───────────────────────────────────────────────────────────────
+# User Configuration
+# ───────────────────────────────────────────────────────────────
+USER_STORAGE_LIMIT=10737418240   # 10 GB
+USER_MAX_FILE_SIZE=104857600     # 100 MB
+
+# ───────────────────────────────────────────────────────────────
+# PostgreSQL Configuration
+# ───────────────────────────────────────────────────────────────
+POSTGRES_URL=postgres://colanode_user:postgrespass123@localhost:5432/colanode_db
+# POSTGRES_SSL_REJECT_UNAUTHORIZED=false
+# POSTGRES_SSL_CA=
+# POSTGRES_SSL_KEY=
+# POSTGRES_SSL_CERT=
+
+# ───────────────────────────────────────────────────────────────
+# Redis Configuration
+# ───────────────────────────────────────────────────────────────
+REDIS_URL=redis://:your_valkey_password@localhost:6379/0
+REDIS_DB=0
+REDIS_JOBS_QUEUE_NAME=jobs
+REDIS_JOBS_QUEUE_PREFIX=colanode
+REDIS_EVENTS_CHANNEL=events
+
+# ───────────────────────────────────────────────────────────────
+# S3 Storage Configuration (MinIO)
+# ───────────────────────────────────────────────────────────────
+STORAGE_S3_ENDPOINT=http://localhost:9000
+STORAGE_S3_ACCESS_KEY=minioadmin
+STORAGE_S3_SECRET_KEY=your_minio_password
+STORAGE_S3_BUCKET=colanode
+STORAGE_S3_REGION=us-east-1
+STORAGE_S3_FORCE_PATH_STYLE=true
+
+# ───────────────────────────────────────────────────────────────
+# SMTP Configuration
+# ───────────────────────────────────────────────────────────────
+SMTP_ENABLED=false
+# SMTP_HOST=smtp
+# SMTP_PORT=1025
+# SMTP_USER=
+# SMTP_PASSWORD=
+# SMTP_EMAIL_FROM=your_email@example.com
+# SMTP_EMAIL_FROM_NAME=Colanode
+
+# ───────────────────────────────────────────────────────────────
+# AI Configuration (experimental)
+# ───────────────────────────────────────────────────────────────
+AI_ENABLED=false
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