diff --git a/cmd/engine/main.go b/cmd/engine/main.go
index e2048ed..bd447b0 100644
--- a/cmd/engine/main.go
+++ b/cmd/engine/main.go
@@ -46,8 +46,16 @@ func main() {
 
 func run() error {
 	configPath := flag.String("config", "", "path to config.yaml (optional; env vars take precedence)")
+	localMode := flag.Bool("local", false, "zero-config local mode: localhost Postgres, local storage, listen on :7654, no setup (sets VLE_LOCAL_MODE)")
 	flag.Parse()
 
+	// --local is sugar for VLE_LOCAL_MODE=true so the CLI flag and the env
+	// var (used by the all-in-one Docker image) flow through one path in
+	// config.Load. Set it before Load reads the environment.
+	if *localMode {
+		_ = os.Setenv("VLE_LOCAL_MODE", "true")
+	}
+
 	cfg, err := config.Load(*configPath)
 	if err != nil {
 		return fmt.Errorf("load config: %w", err)
@@ -56,6 +64,7 @@ func run() error {
 	logger := newLogger(cfg.Log)
 	logger.Info("starting vectorless-engine",
 		"version", version,
+		"local_mode", config.LocalModeEnabled(),
 		"storage_driver", cfg.Storage.Driver,
 		"queue_driver", cfg.Queue.Driver,
 		"llm_driver", cfg.LLM.Driver,
diff --git a/config.example.yaml b/config.example.yaml
index 977fe24..141b165 100644
--- a/config.example.yaml
+++ b/config.example.yaml
@@ -13,6 +13,19 @@
 #
 # `vectorless-engine config print` prints the effective config with secrets
 # redacted; `vectorless-engine config check` validates it and exits 0/1.
+#
+# ZERO-CONFIG LOCAL MODE
+# ----------------------
+# Run `engine --local` (or set VLE_LOCAL_MODE=true) to boot with no config
+# at all: it listens on :7654, points at a localhost Postgres
+# (postgres://vectorless:vectorless@localhost:5432/vectorless), uses local
+# file storage and the Postgres-backed river queue, and requires no API key
+# to call the engine. This matches the all-in-one Docker image, where
+# Postgres is bundled in the same container. You still supply an LLM
+# provider key (e.g. VLE_LLM_ANTHROPIC_API_KEY) for ingestion + retrieval.
+# Override any local default with the usual env/flags, e.g.
+# VLE_SERVER_ADDR=:9000 or VLE_STORAGE_LOCAL_ROOT=/data/documents.
+# Local mode is for dev/local use — do NOT expose it to the public internet.
 
 server:
   addr: ":8080"
diff --git a/pkg/config/config.go b/pkg/config/config.go
index 70cf5e1..3a3dab1 100644
--- a/pkg/config/config.go
+++ b/pkg/config/config.go
@@ -790,10 +790,64 @@ func Default() Config {
 	}
 }
 
+// localDefaultAddr is the canonical local-mode listen address. The whole
+// product (engine API + bundled dashboard) is reachable at
+// localhost:7654 so every doc, link, and quickstart can say one number.
+const localDefaultAddr = ":7654"
+
+// defaultLocalDatabaseURL is the Postgres DSN local mode assumes when no
+// URL is configured. It matches the bundled Postgres in the all-in-one
+// Docker image and the dev docker-compose (user/pass/db all "vectorless"
+// on localhost:5432), so a bare `engine --local` next to those services
+// just connects.
+const defaultLocalDatabaseURL = "postgres://vectorless:vectorless@localhost:5432/vectorless?sslmode=disable"
+
+// LocalModeEnabled reports whether zero-config local mode was requested
+// via the VLE_LOCAL_MODE env var (truthy: 1/true/yes/on). The engine's
+// --local flag sets this var before Load runs, so the CLI flag and the
+// env var (used by the Docker image) share one code path.
+func LocalModeEnabled() bool {
+	switch strings.ToLower(strings.TrimSpace(os.Getenv("VLE_LOCAL_MODE"))) {
+	case "1", "true", "yes", "on":
+		return true
+	}
+	return false
+}
+
+// applyLocalDefaults rewrites the base config for zero-config local
+// running: the canonical :7654 port, a localhost Postgres URL matching
+// the bundled/dev database, local file storage, and the Postgres-backed
+// river queue (no Redis required). It runs on the Default() base BEFORE
+// the YAML file and env overrides are applied, so any value the operator
+// sets explicitly still wins — local mode only moves the starting point
+// so the engine boots with no required configuration.
+//
+// Auth: the standalone engine (cmd/engine) is already unauthenticated —
+// it serves a single logical tenant with no API key — so "local-mode
+// auth" needs no extra wiring here. This is dev/local only and must not
+// be exposed to the public internet.
+func applyLocalDefaults(c *Config) {
+	c.Server.Addr = localDefaultAddr
+	c.Database.URL = defaultLocalDatabaseURL
+	c.Storage.Driver = "local"
+	if c.Storage.Local.Root == "" {
+		c.Storage.Local.Root = "./data/documents"
+	}
+	c.Queue.Driver = "river"
+}
+
 // Load reads configuration from a YAML file (optional) and applies
 // environment overrides on top. Pass an empty path to skip the file.
+//
+// When VLE_LOCAL_MODE is truthy (or the engine is run with --local, which
+// sets it), zero-config local defaults are applied to the base before the
+// file/env layers, so the engine boots on :7654 against a localhost
+// Postgres with no required configuration. File and env still override.
 func Load(path string) (Config, error) {
 	cfg := Default()
+	if LocalModeEnabled() {
+		applyLocalDefaults(&cfg)
+	}
 	if path != "" {
 		data, err := os.ReadFile(path)
 		if err != nil {
@@ -869,6 +923,9 @@ func applyEnvOverrides(c *Config) {
 	if v := os.Getenv("VLE_STORAGE_DRIVER"); v != "" {
 		c.Storage.Driver = v
 	}
+	if v := os.Getenv("VLE_STORAGE_LOCAL_ROOT"); v != "" {
+		c.Storage.Local.Root = v
+	}
 	if v := os.Getenv("VLE_QUEUE_DRIVER"); v != "" {
 		c.Queue.Driver = v
 	}
diff --git a/pkg/config/config_local_test.go b/pkg/config/config_local_test.go
new file mode 100644
index 0000000..5c12f4b
--- /dev/null
+++ b/pkg/config/config_local_test.go
@@ -0,0 +1,99 @@
+package config
+
+import "testing"
+
+// TestLocalModeDefaults: with VLE_LOCAL_MODE set, Load with no file and no
+// other env boots a complete, valid config — :7654, a localhost Postgres
+// URL, local storage, river queue — with nothing else required.
+func TestLocalModeDefaults(t *testing.T) {
+	t.Setenv("VLE_LOCAL_MODE", "true")
+
+	cfg, err := Load("")
+	if err != nil {
+		t.Fatalf("local-mode Load() with no other config should succeed, got: %v", err)
+	}
+	if cfg.Server.Addr != ":7654" {
+		t.Errorf("local mode server.addr = %q, want :7654", cfg.Server.Addr)
+	}
+	if cfg.Database.URL != defaultLocalDatabaseURL {
+		t.Errorf("local mode database.url = %q, want %q", cfg.Database.URL, defaultLocalDatabaseURL)
+	}
+	if cfg.Storage.Driver != "local" {
+		t.Errorf("local mode storage.driver = %q, want local", cfg.Storage.Driver)
+	}
+	if cfg.Queue.Driver != "river" {
+		t.Errorf("local mode queue.driver = %q, want river", cfg.Queue.Driver)
+	}
+	if cfg.Storage.Local.Root == "" {
+		t.Error("local mode storage.local.root must be set")
+	}
+}
+
+// TestLocalModeTruthyForms: the env flag accepts the usual truthy spellings
+// and ignores everything else.
+func TestLocalModeTruthyForms(t *testing.T) {
+	for _, v := range []string{"1", "true", "TRUE", "yes", "on"} {
+		t.Setenv("VLE_LOCAL_MODE", v)
+		if !LocalModeEnabled() {
+			t.Errorf("VLE_LOCAL_MODE=%q should enable local mode", v)
+		}
+	}
+	for _, v := range []string{"", "0", "false", "no", "off", "nope"} {
+		t.Setenv("VLE_LOCAL_MODE", v)
+		if LocalModeEnabled() {
+			t.Errorf("VLE_LOCAL_MODE=%q should NOT enable local mode", v)
+		}
+	}
+}
+
+// TestLocalModeEnvOverridesWin: local mode only moves the starting point —
+// explicit env values still override the local defaults.
+func TestLocalModeEnvOverridesWin(t *testing.T) {
+	t.Setenv("VLE_LOCAL_MODE", "true")
+	t.Setenv("VLE_SERVER_ADDR", ":9999")
+	t.Setenv("VLE_DATABASE_URL", "postgres://custom:custom@db:5432/custom?sslmode=disable")
+	t.Setenv("VLE_STORAGE_LOCAL_ROOT", "/srv/docs")
+
+	cfg, err := Load("")
+	if err != nil {
+		t.Fatalf("Load() failed: %v", err)
+	}
+	if cfg.Server.Addr != ":9999" {
+		t.Errorf("env should override local addr: got %q, want :9999", cfg.Server.Addr)
+	}
+	if cfg.Database.URL != "postgres://custom:custom@db:5432/custom?sslmode=disable" {
+		t.Errorf("env should override local db url, got %q", cfg.Database.URL)
+	}
+	if cfg.Storage.Local.Root != "/srv/docs" {
+		t.Errorf("VLE_STORAGE_LOCAL_ROOT should set storage root, got %q", cfg.Storage.Local.Root)
+	}
+}
+
+// TestNonLocalModeUnchanged: without the flag the historical defaults hold
+// (:8080), and the engine still requires a database URL for the river
+// queue — i.e. local mode is the ONLY thing that injects one.
+func TestNonLocalModeUnchanged(t *testing.T) {
+	t.Setenv("VLE_LOCAL_MODE", "")
+	// Provide a DB URL so validation passes for the river default.
+	t.Setenv("VLE_DATABASE_URL", "postgres://x:x@localhost:5432/x?sslmode=disable")
+
+	cfg, err := Load("")
+	if err != nil {
+		t.Fatalf("Load() failed: %v", err)
+	}
+	if cfg.Server.Addr != ":8080" {
+		t.Errorf("non-local addr = %q, want :8080", cfg.Server.Addr)
+	}
+}
+
+// TestNonLocalModeMissingDBURLFails proves the local-mode injection is what
+// removes the "no required config" gap: without it and without a DB URL,
+// the river queue fails validation.
+func TestNonLocalModeMissingDBURLFails(t *testing.T) {
+	t.Setenv("VLE_LOCAL_MODE", "")
+	t.Setenv("VLE_DATABASE_URL", "")
+
+	if _, err := Load(""); err == nil {
+		t.Fatal("expected validation error for river queue with no database.url, got nil")
+	}
+}