diff --git a/.env b/.env
index a69b788c..c96b55cb 100644
--- a/.env
+++ b/.env
@@ -1,3 +1,6 @@
+# DEPRECATED: This file is a legacy reference file.
+# For local builds: versions are no longer tracked, :latest is used automatically
+# For GCP builds: use .gcp.env instead
 SENTRIUS_VERSION=1.1.62
 SENTRIUS_SSH_VERSION=1.1.16
 SENTRIUS_KEYCLOAK_VERSION=1.1.18
diff --git a/.gitignore b/.gitignore
index 151dfcc5..a4848a7b 100644
--- a/.gitignore
+++ b/.gitignore
@@ -48,6 +48,8 @@ package-lock.json
 
 .settings/*
 .env.bak
+.local.env.bak
+.gcp.env.bak
 cp.env.bak
 .generated.env
 api/node_modules/
diff --git a/.local.env b/.local.env
index 4eecd0ea..c0c970b9 100644
--- a/.local.env
+++ b/.local.env
@@ -1,4 +1,7 @@
-SENTRIUS_VERSION=1.1.523
+# DEPRECATED: This file is no longer used for local builds.
+# Local builds now use :latest tag automatically.
+# This file is kept for backward compatibility only.
+SENTRIUS_VERSION=1.1.507
 SENTRIUS_SSH_VERSION=1.1.45
 SENTRIUS_KEYCLOAK_VERSION=1.1.64
 SENTRIUS_AGENT_VERSION=1.1.51
diff --git a/docs/version-management.md b/docs/version-management.md
new file mode 100644
index 00000000..551a433b
--- /dev/null
+++ b/docs/version-management.md
@@ -0,0 +1,113 @@
+# Version Management Changes
+
+## Overview
+
+The version tracking system for Docker images has been simplified for local development. This document explains the changes and how to use the new system.
+
+## What Changed
+
+### Before
+- `.local.env` file tracked version numbers for all Docker images
+- Every local build incremented the version number
+- Version numbers were stored and tracked in version control
+
+### After
+- Local builds now always use `:latest` tag
+- No version tracking needed for local development
+- `.local.env` is deprecated for local builds (kept for backward compatibility)
+- `.gcp.env` still tracks versions for GCP deployments
+
+## Benefits
+
+1. **Simplified Development**: No need to track version numbers during local development
+2. **Cleaner Git History**: No more version number updates cluttering commits
+3. **Easier Collaboration**: No conflicts from version number changes
+4. **Consistent with Docker Best Practices**: Using `:latest` for local dev is standard
+
+## Usage
+
+### Building Images Locally
+
+```bash
+# Build a single image (always uses :latest)
+./ops-scripts/base/build-images.sh local --sentrius
+
+# Build all images (always uses :latest)
+./ops-scripts/base/build-images.sh local --all
+```
+
+### Deploying Locally
+
+```bash
+# Deploy to local Kubernetes (uses :latest tags)
+./ops-scripts/local/deploy-helm.sh
+```
+
+### Building for GCP
+
+```bash
+# Build for GCP (still uses version tracking from .gcp.env)
+./ops-scripts/base/build-images.sh gcp --sentrius
+
+# Versions are automatically incremented and stored in .gcp.env
+```
+
+## Migration Guide
+
+If you have existing local deployments:
+
+1. **No action required** - The changes are backward compatible
+2. Existing images with version tags will continue to work
+3. New builds will create `:latest` tags alongside any existing versioned images
+4. Next time you build, the `:latest` tag will be used
+
+## File Reference
+
+- `.env` - Legacy reference file (deprecated)
+- `.local.env` - Local version tracking (deprecated, kept for compatibility)
+- `.gcp.env` - GCP version tracking (still active and required for GCP deployments)
+- `.env.bak`, `.local.env.bak`, `.gcp.env.bak` - Backup files (gitignored)
+
+## Technical Details
+
+### Build Script Changes
+
+The `build-images.sh` script now:
+1. Only loads `.env` file when building for GCP
+2. Sets version to "latest" for local builds before calling `build_image()`
+3. Skips version increment and env file updates for local builds
+
+### Deploy Script Changes
+
+The `deploy-helm.sh` script now:
+1. Sets all version variables to "latest" at startup
+2. Does not source `.local.env`
+3. Passes "latest" to all Helm `--set` commands for image tags
+
+## Troubleshooting
+
+### Images not found
+
+If you get "image not found" errors:
+```bash
+# Rebuild the images
+./ops-scripts/base/build-images.sh local --all
+```
+
+### Want to use specific versions locally
+
+If you need specific versions for local testing, you can override via environment variables:
+```bash
+# Override a single service version
+SENTRIUS_VERSION="1.2.3" ./ops-scripts/local/deploy-helm.sh
+
+# Override multiple service versions
+SENTRIUS_VERSION="1.2.3" SENTRIUS_SSH_VERSION="1.1.5" ./ops-scripts/local/deploy-helm.sh
+```
+
+Or pass it directly to helm:
+```bash
+helm upgrade --install sentrius ./sentrius-chart \
+  --set sentrius.image.tag=1.2.3 \
+  ...
+```
diff --git a/ops-scripts/base/build-images.sh b/ops-scripts/base/build-images.sh
index 4a215b44..5e1ba651 100755
--- a/ops-scripts/base/build-images.sh
+++ b/ops-scripts/base/build-images.sh
@@ -15,10 +15,12 @@ if [[ "$1" == "local" || "$1" == "gcp" ]]; then
     shift
 fi
 
-# --- Load and back up environment file ---
-ENV_FILE=".$ENV_TARGET.env"
-source "$ENV_FILE"
-cp "$ENV_FILE" "$ENV_FILE.bak"
+# --- Load environment file only for GCP (versions needed for registry) ---
+if [[ "$ENV_TARGET" == "gcp" ]]; then
+    ENV_FILE=".$ENV_TARGET.env"
+    source "$ENV_FILE"
+    cp "$ENV_FILE" "$ENV_FILE.bak"
+fi
 
 # --- Minikube Docker context ---
 if [[ "$ENV_TARGET" == "local" ]]; then
@@ -65,6 +67,11 @@ build_image() {
     local version=$2
     local context_dir=$3
 
+    # For local builds, always use 'latest' tag
+    if [[ "$ENV_TARGET" == "local" ]]; then
+        version="latest"
+    fi
+
     echo "Building $name:$version..."
     prepare_docker_context "$context_dir"
 
@@ -97,7 +104,6 @@ build_image() {
         docker push "$REGISTRY/$name:$version"
         echo "✅ Pushed $REGISTRY/$name:$version"
     else
-        docker tag "$name:$version" "$name:latest"
         echo "✅ Built locally: $name:$version"
     fi
 
@@ -109,6 +115,11 @@ build_keycloak_image() {
     local version=$2
     local context_dir=$3
 
+    # For local builds, always use 'latest' tag
+    if [[ "$ENV_TARGET" == "local" ]]; then
+        version="latest"
+    fi
+
     echo "Building $name:$version..."
     prepare_docker_context "$context_dir"
 
@@ -155,7 +166,6 @@ build_keycloak_image() {
         docker push "$REGISTRY/$name:$version"
         echo "✅ Pushed $REGISTRY/$name:$version"
     else
-        docker tag "$name:$version" "$name:latest"
         echo "✅ Built locally: $name:$version"
     fi
 
@@ -204,38 +214,58 @@ fi
 # --- Build Steps ---
 if $update_sentrius; then
     cp api/target/sentrius-api-*.jar docker/sentrius/sentrius.jar
-    SENTRIUS_VERSION=$(increment_patch_version $SENTRIUS_VERSION)
+    if [[ "$ENV_TARGET" == "gcp" ]]; then
+        SENTRIUS_VERSION=$(increment_patch_version $SENTRIUS_VERSION)
+        update_env_var "SENTRIUS_VERSION" "$SENTRIUS_VERSION"
+    else
+        SENTRIUS_VERSION="latest"
+    fi
     build_image "sentrius" "$SENTRIUS_VERSION" "${SCRIPT_DIR}/../../docker/sentrius/"
     rm docker/sentrius/sentrius.jar
-    update_env_var "SENTRIUS_VERSION" "$SENTRIUS_VERSION"
 fi
 
 if $update_sentrius_ssh; then
-    SENTRIUS_SSH_VERSION=$(increment_patch_version $SENTRIUS_SSH_VERSION)
+    if [[ "$ENV_TARGET" == "gcp" ]]; then
+        SENTRIUS_SSH_VERSION=$(increment_patch_version $SENTRIUS_SSH_VERSION)
+        update_env_var "SENTRIUS_SSH_VERSION" "$SENTRIUS_SSH_VERSION"
+    else
+        SENTRIUS_SSH_VERSION="latest"
+    fi
     build_image "sentrius-ssh" "$SENTRIUS_SSH_VERSION" "${SCRIPT_DIR}/../../docker/fake-ssh"
-    update_env_var "SENTRIUS_SSH_VERSION" "$SENTRIUS_SSH_VERSION"
 fi
 
 if $update_sentrius_keycloak; then
-    SENTRIUS_KEYCLOAK_VERSION=$(increment_patch_version $SENTRIUS_KEYCLOAK_VERSION)
+    if [[ "$ENV_TARGET" == "gcp" ]]; then
+        SENTRIUS_KEYCLOAK_VERSION=$(increment_patch_version $SENTRIUS_KEYCLOAK_VERSION)
+        update_env_var "SENTRIUS_KEYCLOAK_VERSION" "$SENTRIUS_KEYCLOAK_VERSION"
+    else
+        SENTRIUS_KEYCLOAK_VERSION="latest"
+    fi
     build_keycloak_image "sentrius-keycloak" "$SENTRIUS_KEYCLOAK_VERSION" "${SCRIPT_DIR}/../../docker/keycloak"
-    update_env_var "SENTRIUS_KEYCLOAK_VERSION" "$SENTRIUS_KEYCLOAK_VERSION"
 fi
 
 if $update_sentrius_agent; then
     cp analytics/target/analytics-*.jar docker/sentrius-agent/agent.jar
-    SENTRIUS_AGENT_VERSION=$(increment_patch_version $SENTRIUS_AGENT_VERSION)
+    if [[ "$ENV_TARGET" == "gcp" ]]; then
+        SENTRIUS_AGENT_VERSION=$(increment_patch_version $SENTRIUS_AGENT_VERSION)
+        update_env_var "SENTRIUS_AGENT_VERSION" "$SENTRIUS_AGENT_VERSION"
+    else
+        SENTRIUS_AGENT_VERSION="latest"
+    fi
     build_image "sentrius-agent" "$SENTRIUS_AGENT_VERSION" "${SCRIPT_DIR}/../../docker/sentrius-agent"
     rm docker/sentrius-agent/agent.jar
-    update_env_var "SENTRIUS_AGENT_VERSION" "$SENTRIUS_AGENT_VERSION"
 fi
 
 if $update_sentrius_ai_agent; then
     cp ai-agent/target/ai-agent-*.jar docker/sentrius-ai-agent/agent.jar
-    SENTRIUS_AI_AGENT_VERSION=$(increment_patch_version $SENTRIUS_AI_AGENT_VERSION)
+    if [[ "$ENV_TARGET" == "gcp" ]]; then
+        SENTRIUS_AI_AGENT_VERSION=$(increment_patch_version $SENTRIUS_AI_AGENT_VERSION)
+        update_env_var "SENTRIUS_AI_AGENT_VERSION" "$SENTRIUS_AI_AGENT_VERSION"
+    else
+        SENTRIUS_AI_AGENT_VERSION="latest"
+    fi
     build_image "sentrius-ai-agent" "$SENTRIUS_AI_AGENT_VERSION" "${SCRIPT_DIR}/../../docker/sentrius-ai-agent"
     rm docker/sentrius-ai-agent/agent.jar
-    update_env_var "SENTRIUS_AI_AGENT_VERSION" "$SENTRIUS_AI_AGENT_VERSION"
 
     cp ai-agent/target/ai-agent-*.jar docker/sentrius-launchable-agent/agent.jar
     build_image "sentrius-launchable-agent" "$SENTRIUS_AI_AGENT_VERSION" "${SCRIPT_DIR}/../../docker/sentrius-launchable-agent"
@@ -244,40 +274,60 @@ fi
 
 if $update_integrationproxy; then
     cp integration-proxy/target/sentrius-integration-proxy-*.jar docker/integrationproxy/llmproxy.jar
-    LLMPROXY_VERSION=$(increment_patch_version $LLMPROXY_VERSION)
+    if [[ "$ENV_TARGET" == "gcp" ]]; then
+        LLMPROXY_VERSION=$(increment_patch_version $LLMPROXY_VERSION)
+        update_env_var "LLMPROXY_VERSION" "$LLMPROXY_VERSION"
+    else
+        LLMPROXY_VERSION="latest"
+    fi
     build_image "sentrius-integration-proxy" "$LLMPROXY_VERSION" "${SCRIPT_DIR}/../../docker/integrationproxy"
     rm docker/integrationproxy/llmproxy.jar
-    update_env_var "LLMPROXY_VERSION" "$LLMPROXY_VERSION"
 fi
 
 if $update_launcher; then
     cp agent-launcher/target/agent-launcher-*.jar docker/sentrius-launcher-service/launcher.jar
-    LAUNCHER_VERSION=$(increment_patch_version $LAUNCHER_VERSION)
+    if [[ "$ENV_TARGET" == "gcp" ]]; then
+        LAUNCHER_VERSION=$(increment_patch_version $LAUNCHER_VERSION)
+        update_env_var "LAUNCHER_VERSION" "$LAUNCHER_VERSION"
+    else
+        LAUNCHER_VERSION="latest"
+    fi
     build_image "sentrius-launcher-service" "$LAUNCHER_VERSION" "${SCRIPT_DIR}/../../docker/sentrius-launcher-service"
     rm docker/sentrius-launcher-service/launcher.jar
-    update_env_var "LAUNCHER_VERSION" "$LAUNCHER_VERSION"
 fi
 
 if $update_agent_proxy; then
     cp agent-proxy/target/sentrius-agent-proxy-*.jar docker/agent-proxy/agentproxy.jar
-    AGENTPROXY_VERSION=$(increment_patch_version $AGENTPROXY_VERSION)
+    if [[ "$ENV_TARGET" == "gcp" ]]; then
+        AGENTPROXY_VERSION=$(increment_patch_version $AGENTPROXY_VERSION)
+        update_env_var "AGENTPROXY_VERSION" "$AGENTPROXY_VERSION"
+    else
+        AGENTPROXY_VERSION="latest"
+    fi
     build_image "sentrius-agent-proxy" "$AGENTPROXY_VERSION" "${SCRIPT_DIR}/../../docker/agent-proxy"
     rm docker/agent-proxy/agentproxy.jar
-    update_env_var "AGENTPROXY_VERSION" "$AGENTPROXY_VERSION"
 fi
 
 if $update_ssh_proxy; then
     cp ssh-proxy/target/ssh-proxy-*.jar docker/ssh-proxy/sshproxy.jar
-    SSHPROXY_VERSION=$(increment_patch_version $SSHPROXY_VERSION)
+    if [[ "$ENV_TARGET" == "gcp" ]]; then
+        SSHPROXY_VERSION=$(increment_patch_version $SSHPROXY_VERSION)
+        update_env_var "SSHPROXY_VERSION" "$SSHPROXY_VERSION"
+    else
+        SSHPROXY_VERSION="latest"
+    fi
     build_image "sentrius-ssh-proxy" "$SSHPROXY_VERSION" "${SCRIPT_DIR}/../../docker/ssh-proxy"
     rm docker/ssh-proxy/sshproxy.jar
-    update_env_var "SSHPROXY_VERSION" "$SSHPROXY_VERSION"
 fi
 
 if $update_rdp_proxy; then
     cp rdp-proxy/target/rdp-proxy-*.jar docker/rdp-proxy/rdpproxy.jar
-    RDPPROXY_VERSION=$(increment_patch_version $RDPPROXY_VERSION)
+    if [[ "$ENV_TARGET" == "gcp" ]]; then
+        RDPPROXY_VERSION=$(increment_patch_version $RDPPROXY_VERSION)
+        update_env_var "RDPPROXY_VERSION" "$RDPPROXY_VERSION"
+    else
+        RDPPROXY_VERSION="latest"
+    fi
     build_image "sentrius-rdp-proxy" "$RDPPROXY_VERSION" "${SCRIPT_DIR}/../../docker/rdp-proxy"
     rm docker/rdp-proxy/rdpproxy.jar
-    update_env_var "RDPPROXY_VERSION" "$RDPPROXY_VERSION"
 fi
\ No newline at end of file
diff --git a/ops-scripts/local/deploy-helm.sh b/ops-scripts/local/deploy-helm.sh
index 7dfdb34f..ce75eaa9 100755
--- a/ops-scripts/local/deploy-helm.sh
+++ b/ops-scripts/local/deploy-helm.sh
@@ -4,7 +4,19 @@ SCRIPT_DIR=$(cd "$(dirname "${BASH_SOURCE[0]}")" && pwd)
 
 source ${SCRIPT_DIR}/base.sh
 source ${SCRIPT_DIR}/../base/base.sh
-source ${SCRIPT_DIR}/../../.local.env
+
+# For local deployments, use 'latest' tag instead of versioned tags
+# These can be overridden via environment variables if needed
+SENTRIUS_VERSION="${SENTRIUS_VERSION:-latest}"
+SENTRIUS_SSH_VERSION="${SENTRIUS_SSH_VERSION:-latest}"
+SENTRIUS_KEYCLOAK_VERSION="${SENTRIUS_KEYCLOAK_VERSION:-latest}"
+SENTRIUS_AGENT_VERSION="${SENTRIUS_AGENT_VERSION:-latest}"
+SENTRIUS_AI_AGENT_VERSION="${SENTRIUS_AI_AGENT_VERSION:-latest}"
+LLMPROXY_VERSION="${LLMPROXY_VERSION:-latest}"
+LAUNCHER_VERSION="${LAUNCHER_VERSION:-latest}"
+AGENTPROXY_VERSION="${AGENTPROXY_VERSION:-latest}"
+SSHPROXY_VERSION="${SSHPROXY_VERSION:-latest}"
+RDPPROXY_VERSION="${RDPPROXY_VERSION:-latest}"
 
 CERT_DIR="${SCRIPT_DIR}/../../docker/dev-certs"
 CERT_FILE="${CERT_DIR}/sentrius-ca.crt"
@@ -18,11 +30,6 @@ CERT_DIR="${SCRIPT_DIR}/../../docker/dev-certs"
 DEPLOY_ADMINER=${DEPLOY_ADMINER:-false}
 ENABLE_RDP_CONTAINER=${ENABLE_RDP_CONTAINER:-true}
 
-# --- Load and back up environment file ---
-ENV_FILE="${SCRIPT_DIR}/../../.$ENV_TARGET.env"
-source "$ENV_FILE"
-cp "$ENV_FILE" "$ENV_FILE.bak"
-
 (source ${SCRIPT_DIR}/../base/generate-secrets.sh)
 
 GENERATED_ENV_PATH="${SCRIPT_DIR}/../../.generated.env"