diff --git a/.dockerignore b/.dockerignore
index c5571b021..ce7b14d46 100644
--- a/.dockerignore
+++ b/.dockerignore
@@ -1,7 +1,10 @@
-# Existing configuration exclusions
+# Configuration files - exclude potentially sensitive props but allow templates and default configs
 obp-api/src/main/resources/props/*
 !obp-api/src/main/resources/props/sample.props.template
 !obp-api/src/main/resources/props/test.default.props.template
+!obp-api/src/main/resources/props/test.default.props
+!obp-api/src/main/resources/props/default.props
+!obp-api/src/main/resources/props/development.default.props
 
 # IDE and editor files
 .idea/
@@ -60,8 +63,8 @@ README.md
 
 # Docker files themselves (avoid recursive copies)
 Dockerfile
-docker/
-!docker/entrypoint.sh
+development/docker/
+!development/docker/entrypoint.sh
 
 # Test and development files
 ideas/
diff --git a/Dockerfile b/development/docker/Dockerfile
similarity index 100%
rename from Dockerfile
rename to development/docker/Dockerfile
diff --git a/docker/Dockerfile b/development/docker/Dockerfile.dev
similarity index 87%
rename from docker/Dockerfile
rename to development/docker/Dockerfile.dev
index e4d6dd6e6..d24ca0f64 100644
--- a/docker/Dockerfile
+++ b/development/docker/Dockerfile.dev
@@ -21,7 +21,7 @@ EXPOSE 8080
 RUN mvn install -pl .,obp-commons -am -DskipTests
 
 # Copy entrypoint script that runs mvn with needed JVM flags
-COPY docker/entrypoint.sh /app/entrypoint.sh
+COPY development/docker/entrypoint.sh /app/entrypoint.sh
 RUN chmod +x /app/entrypoint.sh
 
 # Use script as entrypoint
diff --git a/docker/README.md b/development/docker/README.md
similarity index 100%
rename from docker/README.md
rename to development/docker/README.md
diff --git a/development/docker/docker-compose.override.yml b/development/docker/docker-compose.override.yml
new file mode 100644
index 000000000..5c2291bf3
--- /dev/null
+++ b/development/docker/docker-compose.override.yml
@@ -0,0 +1,7 @@
+version: "3.8"
+
+services:
+  obp-api:
+    volumes:
+      - ../../obp-api:/app/obp-api
+      - ../../obp-commons:/app/obp-commons
diff --git a/development/docker/docker-compose.yml b/development/docker/docker-compose.yml
new file mode 100644
index 000000000..6099f3626
--- /dev/null
+++ b/development/docker/docker-compose.yml
@@ -0,0 +1,21 @@
+version: "3.8"
+
+services:
+  obp-api:
+    build:
+      context: ../..
+      dockerfile: development/docker/Dockerfile
+    ports:
+      - "8080:8080"
+    environment:
+      # Set Lift props location to find your props files
+      - props.resource.dir=/app/props/
+      - JAVA_OPTS=-Drun.mode=production -Dprops.resource.dir=/app/props/
+    volumes:
+      # Mount the props directory so the container uses your local props files
+      - ../../obp-api/src/main/resources/props:/app/props
+    extra_hosts:
+      # Connect to local Postgres on the host
+      # In your config file:
+      # db.url=jdbc:postgresql://host.docker.internal:5432/YOUR_DB?user=YOUR_DB_USER&password=YOUR_DB_PASSWORD
+      - "host.docker.internal:host-gateway"
diff --git a/docker/entrypoint.sh b/development/docker/entrypoint.sh
similarity index 100%
rename from docker/entrypoint.sh
rename to development/docker/entrypoint.sh
diff --git a/docker/docker-compose.override.yml b/docker/docker-compose.override.yml
deleted file mode 100644
index 80e973a2c..000000000
--- a/docker/docker-compose.override.yml
+++ /dev/null
@@ -1,7 +0,0 @@
-version: "3.8"
-
-services:
-  obp-api:
-    volumes:
-      - ../obp-api:/app/obp-api
-      - ../obp-commons:/app/obp-commons
diff --git a/docker/docker-compose.yml b/docker/docker-compose.yml
deleted file mode 100644
index ca4eda42a..000000000
--- a/docker/docker-compose.yml
+++ /dev/null
@@ -1,14 +0,0 @@
-version: "3.8"
-
-services:
-  obp-api:
-    build:
-      context: ..
-      dockerfile: docker/Dockerfile
-    ports:
-      - "8080:8080"
-    extra_hosts:
-      # Connect to local Postgres on the host
-      # In your config file:
-      # db.url=jdbc:postgresql://host.docker.internal:5432/YOUR_DB?user=YOUR_DB_USER&password=YOUR_DB_PASSWORD
-      - "host.docker.internal:host-gateway"