diff --git a/.env.example b/.env
similarity index 54%
rename from .env.example
rename to .env
index 54add52a..4f03e15b 100644
--- a/.env.example
+++ b/.env
@@ -1,14 +1,11 @@
-# Used to verify the integrity of signed cookies. so ensure a secure value is set
-SECRET_KEY_BASE=replace_with_lengthy_secure_hex
+# DO NOT STORE SECRETS HERE.
+# Use .env.development for local secrets.
 
 REDIS_URL=redis://localhost:6379
 
 # CI/CD
 TEST_RETRY=0
 CI=false
-DOCKER_IMAGE=nimblehq/rails_template
-DOCKER_REGISTRY_HOST=docker.io
-
 
 # Mail
 MAILER_DEFAULT_HOST=localhost
diff --git a/.env.development.example b/.env.development.example
new file mode 100644
index 00000000..f73db68f
--- /dev/null
+++ b/.env.development.example
@@ -0,0 +1,5 @@
+# DO NOT COMMIT THIS FILE.
+# Rename it to `.env.development` and use it for local secrets only.
+
+# Used to verify the integrity of signed cookies. so ensure a secure value is set
+SECRET_KEY_BASE=replace_with_lengthy_secure_hex
diff --git a/.gitignore.rb b/.gitignore.rb
index 39dbe8cd..a6687030 100644
--- a/.gitignore.rb
+++ b/.gitignore.rb
@@ -11,7 +11,7 @@
     # Ignore the test coverage results from SimpleCov
     /coverage
 
-    # Ignore environment variables files (as it might contain sensitive data)
-    .env
+    # Ignore environment variables files
+    .env.development
   IGNORE
 end
diff --git a/.template/addons/docker/Dockerfile.tt b/.template/addons/docker/Dockerfile.tt
index 68bf0f65..3351fc43 100644
--- a/.template/addons/docker/Dockerfile.tt
+++ b/.template/addons/docker/Dockerfile.tt
@@ -98,8 +98,6 @@ COPY . ./
 RUN rm -rf tmp/docker
 
 <%- if WEB_VARIANT -%>
-# Provide fallback for env variables
-RUN cp .env.example .env
 
 # Compile assets
 RUN bin/rails assets:precompile
diff --git a/.template/addons/docker/template.rb b/.template/addons/docker/template.rb
index ca46b687..a2ee54ce 100644
--- a/.template/addons/docker/template.rb
+++ b/.template/addons/docker/template.rb
@@ -8,10 +8,11 @@
 template 'docker-compose.yml.tt'
 template '.dockerignore.tt'
 
-append_to_file '.env.example' do
+append_to_file '.env' do
   <<~ENVEXAMPLE
 
     # Docker
+    APP_NAME=#{APP_NAME}
     DOCKER_REGISTRY_HOST=#{DOCKER_REGISTRY_HOST}
     DOCKER_IMAGE=#{DOCKER_IMAGE}
     BRANCH_TAG=latest
diff --git a/.template/hooks/before_complete/copy_env_example.rb b/.template/hooks/before_complete/copy_env_example.rb
deleted file mode 100644
index 8bfcee75..00000000
--- a/.template/hooks/before_complete/copy_env_example.rb
+++ /dev/null
@@ -1,9 +0,0 @@
-# frozen_string_literal: true
-
-def copy_env_example
-  use_source_path __dir__
-
-  run 'cp .env.example .env'
-end
-
-copy_env_example
diff --git a/.template/spec/addons/base/docker/template_spec.rb b/.template/spec/addons/base/docker/template_spec.rb
index 208b3741..875edc76 100644
--- a/.template/spec/addons/base/docker/template_spec.rb
+++ b/.template/spec/addons/base/docker/template_spec.rb
@@ -5,10 +5,6 @@
     expect(file('Dockerfile')).to exist
   end
 
-  it 'creates the docker env file' do
-    expect(file('.env')).to exist
-  end
-
   it 'creates the docker ignore file' do
     expect(file('.dockerignore')).to exist
   end
diff --git a/.template/spec/base/template_spec.rb b/.template/spec/base/template_spec.rb
index 52d03f75..68e015e9 100644
--- a/.template/spec/base/template_spec.rb
+++ b/.template/spec/base/template_spec.rb
@@ -31,11 +31,11 @@
     expect(file('.reek.yml')).to exist
   end
 
-  it 'creates .env.example file' do
-    expect(file('.env.example')).to exist
-  end
-
   it 'creates .env file' do
     expect(file('.env')).to exist
   end
+
+  it 'creates .env.development.example file' do
+    expect(file('.env.development.example')).to exist
+  end
 end
diff --git a/.template/spec/support/serverspec.rb b/.template/spec/support/serverspec.rb
index 03527d6e..289cbef3 100644
--- a/.template/spec/support/serverspec.rb
+++ b/.template/spec/support/serverspec.rb
@@ -7,7 +7,12 @@ module ServerSpecHelpers
   # Prebuild and run docker image before running the test
   # Because the docker api does not support docker compose
   def self.test_container
+    puts 'HERERERERERE'
+    puts 'HERERERERERE'
+    puts ENV.fetch('APP_NAME')
     container_id = `docker ps -qf "name=#{ENV.fetch('APP_NAME')}_test"`
+    puts 'Container ID:'
+    puts container_id
 
     Docker::Container.get(container_id.strip)
   end
diff --git a/Makefile b/Makefile
index 755c4ff3..4015127d 100644
--- a/Makefile
+++ b/Makefile
@@ -18,19 +18,16 @@ create_api:
 
 build:
 	cd $(APP_NAME) && \
-	cp .env.example .env && \
 	bin/docker-prepare && \
 	docker-compose -f docker-compose.test.yml build
 
 build_production:
 	cd $(APP_NAME) && \
-	cp .env.example .env && \
 	bin/docker-prepare && \
 	docker-compose build
 
 test_variant_app:
 	cd $(APP_NAME) && \
-	cp .env.example .env && \
 	docker-compose -f docker-compose.test.yml run test
 
 base_addon_spec = spec/addons/base/**/*_spec.rb
@@ -47,7 +44,6 @@ test_template:
 	docker-compose -f docker-compose.test.yml run test bash -c "./bin/inject_port_into_nginx.sh && nginx -c /etc/nginx/conf.d/default.conf -t" && \
 	docker-compose -f docker-compose.test.yml run --detach test bin/start.sh && \
 	cd ../.template && \
-	cp .env.example .env && \
 	bundle install; \
 	if [ $(VARIANT) = web ]; then \
 		bundle exec rspec --pattern="${base_spec}, ${web_spec}, ${base_addon_spec}, ${web_addon_spec}" --format progress; \
diff --git a/template.rb b/template.rb
index 5841e41a..df16ab4c 100644
--- a/template.rb
+++ b/template.rb
@@ -34,7 +34,8 @@ def apply_template!(template_root)
 
   copy_file '.flayignore'
   copy_file 'Dangerfile'
-  copy_file '.env.example'
+  copy_file '.env'
+  copy_file '.env.development.example'
   copy_file '.rubocop.yml'
   copy_file '.reek.yml'
 
@@ -80,9 +81,6 @@ def apply_template!(template_root)
   apply '.template/variants/web/template.rb' if WEB_VARIANT
 
   # A list necessary jobs that run before complete, ex: Fixing rubocop on Ruby files that generated by Rails
-  # before_bundle
-  apply '.template/hooks/before_complete/copy_env_example.rb'
-  # after_bundle
   apply '.template/hooks/before_complete/fix_rubocop.rb'
   apply '.template/hooks/before_complete/report.rb'
 end