diff --git a/docs/development.md b/docs/development.md
index b33c8d1..b4a6b34 100644
--- a/docs/development.md
+++ b/docs/development.md
@@ -69,7 +69,54 @@ npm run pretty
 npm run type-check
 ```
 
-### Summary of Server-Side Rendering and Client-Side Data Handling for Jobs and Chat Routes
+## Local Dev Chat Environment
+
+### 1) Using the ilab command line tool
+
+For the chat functionality to work you need a ilab model chat instance. To run this locally:
+
+`cd server`
+
+[https://github.com/instructlab/instructlab?tab=readme-ov-file#-getting-started](https://github.com/instructlab/instructlab?tab=readme-ov-file#-getting-started)
+
+After you use the `ilab serve` command you should have, by default, a chat server instance running on port 8000.
+
+### 2) Using Podman
+
+#### Current issues
+
+- The docker image that runs the server does not utilise Mac Metal GPU and therefore is very slow when answering prompts
+- The docker image is very large as it contains the model itself. Potential to have the model incoperated via a docker volume to reduce the size of the actual image.
+
+`docker run -p 8000:8000 aevo987654/instructlab_chat_8000:v2`
+
+This should run a server on port 8000
+
+### Configuring the chat environment to use a local ilab model chat instance
+
+Return back to the root of the repo (ui) and run `npm run dev` and visit [http://localhost:3000/playground/endpoints](http://localhost:3000/playground/endpoints).
+
+Click the `Add Endpoint` button and a popup modal will appear.
+
+![enter image description here](../public/dev-local-chat-server/add-endpoint.png)
+
+- URL - add `http://127.0.0.1:8000`
+- Model Name - add `merlinite-7b-lab-Q4_K_M.gguf`
+- API Key - add some random characters
+
+Click the `Save` button
+
+![enter image description here](../public/dev-local-chat-server/added-endpoint.png)
+
+Go to the chat interface [http://localhost:3000/playground/chat](http://localhost:3000/playground/chat) and select the `merlinite-7b-lab-Q4_K_M.gguf` model.
+
+![enter image description here](../public/dev-local-chat-server/select-the-correct-model.png)
+
+The chat interface should now use the server.
+
+![enter image description here](../public/dev-local-chat-server/successful-chat.png)
+
+## Summary of Server-Side Rendering and Client-Side Data Handling for Jobs and Chat Routes
 
 We are leveraging Next.js's app router to handle
 [server-side rendering](https://nextjs.org/docs/pages/building-your-application/rendering/server-side-rendering)
@@ -77,7 +124,7 @@ We are leveraging Next.js's app router to handle
 Below is a summary of how we manage server-side rendering and client-side data
 handling for these routes.
 
-#### Server-Side Rendering (SSR)
+### Server-Side Rendering (SSR)
 
 **API Routes**:
 
diff --git a/public/dev-local-chat-server/add-endpoint.png b/public/dev-local-chat-server/add-endpoint.png
new file mode 100644
index 0000000..c415600
Binary files /dev/null and b/public/dev-local-chat-server/add-endpoint.png differ
diff --git a/public/dev-local-chat-server/added-endpoint.png b/public/dev-local-chat-server/added-endpoint.png
new file mode 100644
index 0000000..9d81e01
Binary files /dev/null and b/public/dev-local-chat-server/added-endpoint.png differ
diff --git a/public/dev-local-chat-server/select-the-correct-model.png b/public/dev-local-chat-server/select-the-correct-model.png
new file mode 100644
index 0000000..5bda0e7
Binary files /dev/null and b/public/dev-local-chat-server/select-the-correct-model.png differ
diff --git a/public/dev-local-chat-server/successful-chat.png b/public/dev-local-chat-server/successful-chat.png
new file mode 100644
index 0000000..9b49c34
Binary files /dev/null and b/public/dev-local-chat-server/successful-chat.png differ
diff --git a/server/Containerfile b/server/Containerfile
new file mode 100644
index 0000000..18da2bc
--- /dev/null
+++ b/server/Containerfile
@@ -0,0 +1,21 @@
+FROM python:3.11
+
+# Set working directory
+WORKDIR /app
+
+RUN pip install --upgrade pip
+RUN pip install --no-cache-dir instructlab==0.16.1
+
+# Copy project files to the working directory
+COPY config.yaml .
+
+# Download the merlinite model
+RUN ilab download
+
+# Copy project files to the working directory
+COPY . .
+
+EXPOSE 8000
+
+# Run the chat server with the specified model family and model file
+CMD ["ilab", "serve", "--model-family", "merlinite", "--model-path", "models/merlinite-7b-lab-Q4_K_M.gguf"]
\ No newline at end of file
diff --git a/server/config.yaml b/server/config.yaml
new file mode 100644
index 0000000..ee4f316
--- /dev/null
+++ b/server/config.yaml
@@ -0,0 +1,26 @@
+chat:
+  context: default
+  greedy_mode: false
+  logs_dir: data/chatlogs
+  max_tokens: null
+  model: models/merlinite-7b-lab-Q4_K_M.gguf
+  session: null
+  vi_mode: false
+  visible_overflow: true
+general:
+  log_level: INFO
+generate:
+  chunk_word_count: 1000
+  model: models/merlinite-7b-lab-Q4_K_M.gguf
+  num_cpus: 10
+  num_instructions: 100
+  output_dir: generated
+  prompt_file: prompt.txt
+  seed_file: seed_tasks.json
+  taxonomy_base: origin/main
+  taxonomy_path: taxonomy
+serve:
+  gpu_layers: -1
+  host_port: 0.0.0.0:8000
+  max_ctx_size: 4096
+  model_path: models/merlinite-7b-lab-Q4_K_M.gguf