diff --git a/docs/developing-locally.rst b/docs/developing-locally.rst
index 59079453..8a584165 100644
--- a/docs/developing-locally.rst
+++ b/docs/developing-locally.rst
@@ -9,24 +9,53 @@ Setting Up Development Environment
 
 Make sure to have the following on your host:
 
-* virtualenv_;
-* pip;
-* PostgreSQL.
+* Python 3.6
+* PostgreSQL_.
+* Redis_, if using Celery
 
 First things first.
 
-#. `Create a virtualenv`_.
+#. Create a virtualenv: ::
 
-#. Activate the virtualenv you have just created.
+    $ python3 -m venv <virtual env path>
+
+#. Activate the virtualenv you have just created: ::
+
+    $ source <virtual env path>/bin/activate
 
 #. Install development requirements: ::
 
     $ pip install -r requirements/local.txt
 
-#. Create a new PostgreSQL database (note: if this is the first time a database is created on your machine you might need to alter a localhost-related entry in your ``pg_hba.conf`` so as to utilize ``trust`` policy): ::
+#. Create a new PostgreSQL database using createdb_: ::
 
     $ createdb <what you've entered as the project_slug at setup stage>
 
+   .. note::
+
+       if this is the first time a database is created on your machine you might need to alter
+       a localhost-related entry in your ``pg_hba.conf`` so as to utilize ``trust`` policy, see the
+       `postgres documentation`_ for more details.
+
+#. Set the environment variables for your database(s): ::
+
+    $ export DATABASE_URL=postgres://<project_slug>
+    # Optional: set broker URL if using Celery
+    $ export CELERY_BROKER_URL=redis://localhost:6379/0
+
+   .. note::
+
+       Check out the :ref:`settings` page for a comprehensive list of the environments variables.
+
+   .. seealso::
+
+       To help setting up your environment variables, you have a few options:
+
+       * create an ``.env`` file in the root of your project and define all the variables you need in it.
+         Then you just need to have ``DJANGO_READ_DOT_ENV_FILE=True`` in your machine and all the variables
+         will be read.
+       * Use a local environment manager like `direnv`_
+
 #. Apply migrations: ::
 
     $ python manage.py migrate
@@ -35,8 +64,11 @@ First things first.
 
     $ python manage.py runserver 0.0.0.0:8000
 
-.. _virtualenv: http://docs.python-guide.org/en/latest/dev/virtualenvs/
-.. _`Create a virtualenv`: https://virtualenv.pypa.io/en/stable/userguide/
+.. _PostgreSQL: https://www.postgresql.org/download/
+.. _Redis: https://redis.io/download
+.. _createdb: https://www.postgresql.org/docs/current/static/app-createdb.html
+.. _postgres documentation: https://www.postgresql.org/docs/current/static/auth-pg-hba-conf.html
+.. _direnv: https://direnv.net/
 
 
 Setup Email Backend
@@ -69,9 +101,7 @@ For instance, one of the packages we depend upon, ``django-allauth`` sends verif
 
 Now you have your own mail server running locally, ready to receive whatever you send it.
 
-.. _`Download the latest MailHog release`: https://github.com/mailhog/MailHog/releases
-.. _`properly configured`: https://docs.djangoproject.com/en/dev/topics/email/#smtp-backend
-
+.. _`Download the latest MailHog release`: https://github.com/mailhog/MailHog
 
 Console
 ~~~~~~~
@@ -88,11 +118,8 @@ In production, we have Mailgun_ configured to have your back!
 Sass Compilation & Live Reloading
 ---------------------------------
 
-If you’d like to take advantage of live reloading and Sass compilation you can do so with a little bit of preparation_.
-
-
-.. _preparation: https://cookiecutter-django.readthedocs.io/en/latest/live-reloading-and-sass-compilation.html
-
+If you’d like to take advantage of live reloading and Sass compilation you can do so with a little
+bit of preparation, see :ref:`sass-compilation-live-reload`.
 
 Summary
 -------
diff --git a/docs/live-reloading-and-sass-compilation.rst b/docs/live-reloading-and-sass-compilation.rst
index db8d681f..a55b4fd8 100644
--- a/docs/live-reloading-and-sass-compilation.rst
+++ b/docs/live-reloading-and-sass-compilation.rst
@@ -1,3 +1,5 @@
+.. _sass-compilation-live-reload:
+
 Sass Compilation & Live Reloading
 =================================
 
diff --git a/{{cookiecutter.project_slug}}/.gitignore b/{{cookiecutter.project_slug}}/.gitignore
index 679fb902..1eefea0f 100644
--- a/{{cookiecutter.project_slug}}/.gitignore
+++ b/{{cookiecutter.project_slug}}/.gitignore
@@ -333,6 +333,7 @@ tags
 [Ss]cripts
 pyvenv.cfg
 pip-selfcheck.json
+.env
 {% endif %}
 
 ### Project template