Local AI Development in 2025

August 18, 2025

Running AI locally has become practical. Open models rival proprietary ones, hardware requirements have dropped, and tooling has matured. Local development offers privacy, cost savings, and offline capability.

Here’s how to develop with local AI in 2025.

The Local AI Stack

Model Options

local_models_2025:
  llama_3_1:
    sizes: [8B, 70B]
    requirements:
      8B: "8GB RAM, runs on CPU"
      70B: "48GB+ VRAM or quantized"
    quality: "Near GPT-4 for many tasks"

  mistral:
    sizes: [7B, "8x7B"]
    requirements:
      7B: "8GB RAM"
    quality: "Efficient, strong reasoning"

  phi_3:
    sizes: [3.8B]
    requirements: "4GB RAM"
    quality: "Impressive for size"

  qwen:
    sizes: [7B, 14B, 72B]
    quality: "Strong multilingual"

  code_models:
    codellama: "Code-focused Llama"
    deepseek_coder: "Strong coding capability"

Running Locally

# Ollama - easiest way to run local models
curl -fsSL https://ollama.com/install.sh | sh

# Pull and run a model
ollama pull llama3.1:8b
ollama run llama3.1:8b

# For code
ollama pull codellama:13b
# Using Ollama from Python
import ollama

response = ollama.chat(
    model='llama3.1:8b',
    messages=[
        {'role': 'user', 'content': 'Explain recursion simply'}
    ]
)
print(response['message']['content'])

# Streaming
for chunk in ollama.chat(
    model='llama3.1:8b',
    messages=[{'role': 'user', 'content': 'Write a haiku'}],
    stream=True
):
    print(chunk['message']['content'], end='', flush=True)

Development Workflow

Local Development Setup

class LocalAIDev:
    """Development environment with local AI."""

    def __init__(self, model: str = "llama3.1:8b"):
        self.model = model
        self.client = ollama.Client()

    async def generate(
        self,
        prompt: str,
        system: str = None
    ) -> str:
        messages = []
        if system:
            messages.append({"role": "system", "content": system})
        messages.append({"role": "user", "content": prompt})

        response = self.client.chat(
            model=self.model,
            messages=messages
        )

        return response["message"]["content"]

    async def generate_with_fallback(
        self,
        prompt: str,
        cloud_client = None
    ) -> str:
        """Try local first, fall back to cloud."""
        try:
            return await self.generate(prompt)
        except Exception as e:
            if cloud_client:
                return await cloud_client.generate(prompt)
            raise

Hybrid Local-Cloud

hybrid_strategy:
  local_for:
    - Development and testing
    - Privacy-sensitive data
    - Offline scenarios
    - Cost optimization

  cloud_for:
    - Best quality when needed
    - Production (usually)
    - Complex tasks
    - Fallback

  implementation:
    - Same interface for both
    - Easy switching
    - Cost tracking

Model Selection

class ModelSelector:
    """Select appropriate model for task."""

    def select(self, task: Task) -> ModelConfig:
        if task.requires_best_quality:
            return ModelConfig(
                provider="cloud",
                model="claude-3-5-sonnet"
            )

        if task.privacy_required:
            return ModelConfig(
                provider="local",
                model="llama3.1:8b"
            )

        if task.is_coding:
            return ModelConfig(
                provider="local",
                model="codellama:13b"
            )

        # Default: local for cost
        return ModelConfig(
            provider="local",
            model="llama3.1:8b"
        )

Performance Optimization

local_optimization:
  quantization:
    purpose: "Reduce memory, increase speed"
    options: ["Q4_0", "Q4_K_M", "Q5_K_M", "Q8_0"]
    tradeoff: "Lower quantization = faster but less accurate"

  gpu_acceleration:
    nvidia: "CUDA support in Ollama"
    apple: "Metal support built-in"
    benefit: "10-50x faster than CPU"

  batching:
    purpose: "Process multiple requests efficiently"
    how: "vLLM, TGI for production local"

Key Takeaways

Local AI is a real option. Evaluate for your use case.