In the previous articles, we explored the foundations of local AI development, including the benefits of running AI locally, the capabilities of Phi-3, and the role of n8n in building AI-powered automation workflows.
Now it's time to begin building our local AI stack.
The first step is installing Ollama, the runtime that allows us to download, manage, and run language models directly on our computer.
By the end of this guide, you will have Ollama running on Windows 10 and be ready to install your first local AI model.
What is Ollama?
Ollama is a lightweight platform that simplifies running large language models locally.
Instead of dealing with:
- Python environments
- AI frameworks
- model weights
- GPU configuration
Ollama provides a straightforward way to install and run models using simple commands.
Think of it as a package manager and runtime environment for AI models.
System Requirements
Before installing Ollama, ensure your system meets the following requirements:
Minimum Requirements
- Windows 10 (64-bit)
- 8 GB RAM
- Modern dual-core processor
- Internet connection for model downloads
Recommended Requirements
- Windows 10 22H2 or later
- 16 GB RAM or more
- SSD storage
- Dedicated GPU (optional but beneficial)
Although Ollama can run on modest hardware, additional RAM and a faster CPU will improve performance.
Step 1: Download Ollama
Open your web browser and visit the official Ollama website.
Navigate to the Windows download page and download the latest installer.
Once downloaded, you should have a file similar to:
OllamaSetup.exeStep 2: Run the Installer
Locate the downloaded installer and launch it.
The installation process is straightforward:
- Accept the license agreement.
- Choose the installation location (default is recommended).
- Click Install.
- Wait for the installation to complete.
After installation, Ollama will automatically configure itself and start its local service.
Step 3: Verify the Installation
Open Command Prompt.
Press:
Windows + RType:
cmdand press Enter.
Now execute:
ollama --versionIf installation was successful, you should see version information displayed.
For example:
ollama version 0.x.xStep 4: Troubleshooting PATH Issues
Some Windows systems may display:
'ollama' is not recognized as an internal or external commandThis typically means Windows cannot find the Ollama executable.
Locate Ollama
The default installation path is often:
C:\Users\<username>\AppData\Local\Programs\OllamaVerify that the folder contains:
ollama.exeAdd Ollama to PATH
- Open Windows Search.
- Search for:
Environment Variables- Open:
Edit the system environment variables- Click:
Environment Variables- Under User Variables, select:
Path- Click Edit.
- Click New.
- Add the Ollama installation path.
- Save all changes.
Close and reopen Command Prompt, then try:
ollama --versionagain.
Step 5: Confirm the Local AI Server
One of Ollama's most useful features is that it automatically creates a local AI API server.
Open your browser and navigate to:
http://localhost:11434If Ollama is running correctly, you should receive a response indicating that the server is active.
This local endpoint will later allow n8n, Python applications, and other tools to communicate with your AI models.
Understanding What Just Happened
At this point, you have not installed any AI models yet.
You have only installed the runtime environment.
Think of it like this:
| Component | Purpose |
|---|---|
| Ollama | Runs and manages AI models |
| Phi-3 | The AI model itself |
| n8n | Automation and workflow engine |
The runtime must exist before any models can be downloaded.
Common Beginner Mistakes
Mistake #1: Assuming Ollama Includes Models
A fresh Ollama installation does not include any language models.
You must download models separately.
Mistake #2: Closing the Terminal
Ollama operates as a background service.
Closing Command Prompt does not uninstall or stop Ollama.
Mistake #3: Confusing Ollama with n8n
Ollama runs AI models.
n8n runs automation workflows.
They work together but serve different purposes.
What's Next?
Now that Ollama is installed successfully, the next step is downloading and running your first local language model.
In the next article, we will install Phi-3, launch it locally, and explore how to interact with it through both the command line and Ollama's local API.
By the end of that guide, you'll have your first fully functional AI model running entirely on your own machine.
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