diff --git a/README.md b/README.md
index 907c681b969b..d6cc8c23e4d1 100644
--- a/README.md
+++ b/README.md
@@ -149,6 +149,16 @@ local-ai run https://gist.githubusercontent.com/.../phi-2.yaml
 local-ai run oci://localai/phi-2:latest
 ```
 
+To test a running LocalAI server from the terminal, open an interactive chat session from another shell. Inside the prompt, `/models` lists installed models and `/model <name>` switches between them.
+
+```bash
+# Terminal 1
+local-ai run llama-3.2-1b-instruct:q4_k_m
+
+# Terminal 2
+local-ai chat --model llama-3.2-1b-instruct:q4_k_m
+```
+
 > **Automatic Backend Detection**: LocalAI automatically detects your GPU capabilities and downloads the appropriate backend. For advanced options, see [GPU Acceleration](https://localai.io/features/gpu-acceleration/).
 
 For more details, see the [Getting Started guide](https://localai.io/basics/getting_started/).
diff --git a/core/cli/chat/chat.go b/core/cli/chat/chat.go
new file mode 100644
index 000000000000..071d3a7858ad
--- /dev/null
+++ b/core/cli/chat/chat.go
@@ -0,0 +1,30 @@
+package chat
+
+import (
+	"context"
+	"io"
+	"strings"
+)
+
+type Options struct {
+	Model   string
+	BaseURL string
+	APIKey  string
+	In      io.Reader
+	Out     io.Writer
+}
+
+func Run(ctx context.Context, opts Options) error {
+	if opts.In == nil {
+		opts.In = strings.NewReader("")
+	}
+	if opts.Out == nil {
+		opts.Out = io.Discard
+	}
+
+	session, err := newChatSession(ctx, newLocalAIChatClient(opts.BaseURL, opts.APIKey), opts.Model)
+	if err != nil {
+		return err
+	}
+	return runTerminalChat(ctx, session, opts.In, opts.Out)
+}
diff --git a/core/cli/chat/chat_suite_test.go b/core/cli/chat/chat_suite_test.go
new file mode 100644
index 000000000000..1f4d79aafab6
--- /dev/null
+++ b/core/cli/chat/chat_suite_test.go
@@ -0,0 +1,13 @@
+package chat
+
+import (
+	"testing"
+
+	. "github.com/onsi/ginkgo/v2"
+	. "github.com/onsi/gomega"
+)
+
+func TestChat(t *testing.T) {
+	RegisterFailHandler(Fail)
+	RunSpecs(t, "Chat Suite")
+}
diff --git a/core/cli/chat/chat_test.go b/core/cli/chat/chat_test.go
new file mode 100644
index 000000000000..a5c9a1f3c82c
--- /dev/null
+++ b/core/cli/chat/chat_test.go
@@ -0,0 +1,161 @@
+package chat
+
+import (
+	"bytes"
+	"encoding/json"
+	"fmt"
+	"net/http"
+	"net/http/httptest"
+	"strings"
+
+	. "github.com/onsi/ginkgo/v2"
+	. "github.com/onsi/gomega"
+)
+
+var _ = Describe("Run chat", func() {
+	It("streams a single chat response", func() {
+		var capturedModel string
+		var capturedAuth string
+		server := httptest.NewServer(http.HandlerFunc(func(w http.ResponseWriter, r *http.Request) {
+			if r.URL.Path == "/v1/models" {
+				w.Header().Set("Content-Type", "application/json")
+				fmt.Fprint(w, `{"object":"list","data":[{"id":"test-model","object":"model"}]}`)
+				return
+			}
+
+			Expect(r.URL.Path).To(Equal("/v1/chat/completions"))
+			capturedAuth = r.Header.Get("Authorization")
+
+			var body struct {
+				Model    string `json:"model"`
+				Messages []struct {
+					Role    string `json:"role"`
+					Content string `json:"content"`
+				} `json:"messages"`
+			}
+			Expect(json.NewDecoder(r.Body).Decode(&body)).To(Succeed())
+			capturedModel = body.Model
+			Expect(body.Messages).To(HaveLen(1))
+			Expect(body.Messages[0].Role).To(Equal("user"))
+			Expect(body.Messages[0].Content).To(Equal("hello"))
+
+			w.Header().Set("Content-Type", "text/event-stream")
+			fmt.Fprint(w, "data: {\"choices\":[{\"index\":0,\"delta\":{\"content\":\"hi\"}}]}\n\n")
+			fmt.Fprint(w, "data: {\"choices\":[{\"index\":0,\"delta\":{\"content\":\"!\"}}]}\n\n")
+			fmt.Fprint(w, "data: [DONE]\n\n")
+		}))
+		defer server.Close()
+
+		var out bytes.Buffer
+		err := Run(GinkgoT().Context(), Options{
+			Model:   "test-model",
+			BaseURL: server.URL + "/v1",
+			APIKey:  "secret",
+			In:      strings.NewReader("hello\n/exit\n"),
+			Out:     &out,
+		})
+
+		Expect(err).ToNot(HaveOccurred())
+		Expect(capturedModel).To(Equal("test-model"))
+		Expect(capturedAuth).To(Equal("Bearer secret"))
+		Expect(out.String()).To(ContainSubstring("assistant: hi!"))
+		Expect(out.String()).To(ContainSubstring("bye"))
+	})
+
+	It("auto-selects the only available model", func() {
+		server := chatTestServer([]string{"solo"}, nil)
+		defer server.Close()
+
+		var out bytes.Buffer
+		err := Run(GinkgoT().Context(), Options{
+			BaseURL: server.URL + "/v1",
+			In:      strings.NewReader("/exit\n"),
+			Out:     &out,
+		})
+
+		Expect(err).ToNot(HaveOccurred())
+		Expect(out.String()).To(ContainSubstring("LocalAI chat (solo)"))
+	})
+
+	It("returns an actionable error when no models are installed", func() {
+		server := chatTestServer(nil, nil)
+		defer server.Close()
+
+		err := Run(GinkgoT().Context(), Options{
+			BaseURL: server.URL + "/v1",
+			In:      strings.NewReader(""),
+		})
+
+		Expect(err).To(HaveOccurred())
+		Expect(err.Error()).To(ContainSubstring("no chat models are installed"))
+		Expect(err.Error()).To(ContainSubstring("local-ai models install <model>"))
+	})
+
+	It("returns an actionable error when multiple models are available without a selection", func() {
+		server := chatTestServer([]string{"alpha", "beta"}, nil)
+		defer server.Close()
+
+		err := Run(GinkgoT().Context(), Options{
+			BaseURL: server.URL + "/v1",
+			In:      strings.NewReader(""),
+		})
+
+		Expect(err).To(HaveOccurred())
+		Expect(err.Error()).To(ContainSubstring("multiple models are available"))
+		Expect(err.Error()).To(ContainSubstring("--model"))
+		Expect(err.Error()).To(ContainSubstring("alpha"))
+		Expect(err.Error()).To(ContainSubstring("beta"))
+	})
+
+	It("lists and switches models inside the chat", func() {
+		requestedModels := []string{}
+		server := chatTestServer([]string{"alpha", "beta"}, func(model string) {
+			requestedModels = append(requestedModels, model)
+		})
+		defer server.Close()
+
+		var out bytes.Buffer
+		err := Run(GinkgoT().Context(), Options{
+			Model:   "alpha",
+			BaseURL: server.URL + "/v1",
+			In:      strings.NewReader("/models\n/model beta\nhello\n/exit\n"),
+			Out:     &out,
+		})
+
+		Expect(err).ToNot(HaveOccurred())
+		Expect(out.String()).To(ContainSubstring("* alpha"))
+		Expect(out.String()).To(ContainSubstring("  beta"))
+		Expect(out.String()).To(ContainSubstring("switched to beta; conversation cleared"))
+		Expect(requestedModels).To(Equal([]string{"beta"}))
+	})
+})
+
+func chatTestServer(models []string, onChat func(model string)) *httptest.Server {
+	return httptest.NewServer(http.HandlerFunc(func(w http.ResponseWriter, r *http.Request) {
+		switch r.URL.Path {
+		case "/v1/models":
+			w.Header().Set("Content-Type", "application/json")
+			fmt.Fprint(w, `{"object":"list","data":[`)
+			for i, model := range models {
+				if i > 0 {
+					fmt.Fprint(w, ",")
+				}
+				fmt.Fprintf(w, `{"id":%q,"object":"model"}`, model)
+			}
+			fmt.Fprint(w, `]}`)
+		case "/v1/chat/completions":
+			var body struct {
+				Model string `json:"model"`
+			}
+			Expect(json.NewDecoder(r.Body).Decode(&body)).To(Succeed())
+			if onChat != nil {
+				onChat(body.Model)
+			}
+			w.Header().Set("Content-Type", "text/event-stream")
+			fmt.Fprint(w, "data: {\"choices\":[{\"index\":0,\"delta\":{\"content\":\"ok\"}}]}\n\n")
+			fmt.Fprint(w, "data: [DONE]\n\n")
+		default:
+			w.WriteHeader(http.StatusNotFound)
+		}
+	}))
+}
diff --git a/core/cli/chat/client.go b/core/cli/chat/client.go
new file mode 100644
index 000000000000..93910de7e13c
--- /dev/null
+++ b/core/cli/chat/client.go
@@ -0,0 +1,112 @@
+package chat
+
+import (
+	"context"
+	"errors"
+	"fmt"
+	"io"
+	"sort"
+	"strings"
+
+	openai "github.com/sashabaranov/go-openai"
+)
+
+type chatClient interface {
+	ListModels(ctx context.Context) ([]string, error)
+	StreamChat(ctx context.Context, model string, messages []chatMessage, out io.Writer) (string, error)
+}
+
+type localAIChatClient struct {
+	client *openai.Client
+}
+
+func newLocalAIChatClient(baseURL string, apiKey string) *localAIChatClient {
+	cfg := openai.DefaultConfig(apiKey)
+	cfg.BaseURL = baseURL
+	return &localAIChatClient{client: openai.NewClientWithConfig(cfg)}
+}
+
+func (c *localAIChatClient) ListModels(ctx context.Context) ([]string, error) {
+	resp, err := c.client.ListModels(ctx)
+	if err != nil {
+		return nil, err
+	}
+
+	models := make([]string, 0, len(resp.Models))
+	for _, model := range resp.Models {
+		if model.ID != "" {
+			models = append(models, model.ID)
+		}
+	}
+	sort.Strings(models)
+	return models, nil
+}
+
+func (c *localAIChatClient) StreamChat(ctx context.Context, model string, messages []chatMessage, out io.Writer) (string, error) {
+	stream, err := c.client.CreateChatCompletionStream(ctx, openai.ChatCompletionRequest{
+		Model:    model,
+		Messages: openAIChatMessages(messages),
+	})
+	if err != nil {
+		return "", friendlyChatError(err, model)
+	}
+	defer stream.Close()
+
+	var answer strings.Builder
+	for {
+		resp, err := stream.Recv()
+		if errors.Is(err, io.EOF) {
+			break
+		}
+		if err != nil {
+			return answer.String(), friendlyChatError(err, model)
+		}
+		if len(resp.Choices) == 0 {
+			continue
+		}
+
+		token := resp.Choices[0].Delta.Content
+		if token == "" {
+			continue
+		}
+		answer.WriteString(token)
+		if _, err := fmt.Fprint(out, token); err != nil {
+			return answer.String(), err
+		}
+	}
+
+	return answer.String(), nil
+}
+
+func openAIChatMessages(messages []chatMessage) []openai.ChatCompletionMessage {
+	converted := make([]openai.ChatCompletionMessage, len(messages))
+	for i, message := range messages {
+		converted[i] = openai.ChatCompletionMessage{
+			Role:    message.Role,
+			Content: message.Content,
+		}
+	}
+	return converted
+}
+
+func friendlyChatError(err error, model string) error {
+	var apiErr *openai.APIError
+	if errors.As(err, &apiErr) {
+		switch apiErr.HTTPStatusCode {
+		case 404:
+			return fmt.Errorf("model %q is not available. Run `local-ai models list`, install a model with `local-ai models install <model>`, or switch with `/model <name>`", model)
+		case 403:
+			return fmt.Errorf("model %q is disabled. Enable it from LocalAI settings or choose another model with `/model <name>`", model)
+		}
+		if apiErr.Message != "" {
+			return errors.New(apiErr.Message)
+		}
+	}
+
+	msg := err.Error()
+	if strings.Contains(msg, "model") && strings.Contains(msg, "not found") {
+		return fmt.Errorf("model %q is not available. Run `local-ai models list`, install a model with `local-ai models install <model>`, or switch with `/model <name>`", model)
+	}
+
+	return err
+}
diff --git a/core/cli/chat/models.go b/core/cli/chat/models.go
new file mode 100644
index 000000000000..291ec15aa8c6
--- /dev/null
+++ b/core/cli/chat/models.go
@@ -0,0 +1,17 @@
+package chat
+
+import "strings"
+
+func formatChatModelList(models []string, current string) string {
+	var b strings.Builder
+	for _, model := range models {
+		prefix := "  "
+		if model == current {
+			prefix = "* "
+		}
+		b.WriteString(prefix)
+		b.WriteString(model)
+		b.WriteByte('\n')
+	}
+	return b.String()
+}
diff --git a/core/cli/chat/session.go b/core/cli/chat/session.go
new file mode 100644
index 000000000000..e3075a8af0dc
--- /dev/null
+++ b/core/cli/chat/session.go
@@ -0,0 +1,120 @@
+package chat
+
+import (
+	"context"
+	"errors"
+	"fmt"
+	"io"
+	"strings"
+)
+
+const (
+	chatRoleUser      = "user"
+	chatRoleAssistant = "assistant"
+)
+
+type chatMessage struct {
+	Role    string
+	Content string
+}
+
+type chatSession struct {
+	client   chatClient
+	model    string
+	models   []string
+	messages []chatMessage
+}
+
+func newChatSession(ctx context.Context, client chatClient, requestedModel string) (*chatSession, error) {
+	models, err := client.ListModels(ctx)
+	if err != nil {
+		return nil, fmt.Errorf("list models: %w", err)
+	}
+
+	model, err := resolveChatModel(requestedModel, models)
+	if err != nil {
+		return nil, err
+	}
+
+	return &chatSession{
+		client: client,
+		model:  model,
+		models: models,
+	}, nil
+}
+
+func (s *chatSession) CurrentModel() string {
+	return s.model
+}
+
+func (s *chatSession) Models() []string {
+	models := make([]string, len(s.models))
+	copy(models, s.models)
+	return models
+}
+
+func (s *chatSession) Clear() {
+	s.messages = nil
+}
+
+func (s *chatSession) SwitchModel(model string) error {
+	if !modelExists(s.models, model) {
+		return fmt.Errorf("model %q is not available. Use /models to see installed models", model)
+	}
+	s.model = model
+	s.Clear()
+	return nil
+}
+
+func (s *chatSession) Send(ctx context.Context, prompt string, out io.Writer) error {
+	s.messages = append(s.messages, chatMessage{
+		Role:    chatRoleUser,
+		Content: prompt,
+	})
+
+	answer, err := s.client.StreamChat(ctx, s.model, s.messages, out)
+	if err != nil {
+		return err
+	}
+
+	s.messages = append(s.messages, chatMessage{
+		Role:    chatRoleAssistant,
+		Content: answer,
+	})
+	return nil
+}
+
+func resolveChatModel(requested string, models []string) (string, error) {
+	switch {
+	case requested == "" && len(models) == 0:
+		return "", errors.New(`no chat models are installed.
+
+Install a model first, for example:
+  local-ai models list
+  local-ai models install <model>
+  local-ai run
+
+Then start a chat session:
+  local-ai chat --model <model>`)
+	case requested == "" && len(models) == 1:
+		return models[0], nil
+	case requested == "" && len(models) > 1:
+		var b strings.Builder
+		b.WriteString("multiple models are available; choose one with --model:\n")
+		b.WriteString(formatChatModelList(models, ""))
+		return "", errors.New(b.String())
+	case !modelExists(models, requested):
+		return "", fmt.Errorf("model %q is not available. Use `local-ai models list` and `local-ai models install <model>`, or pass an installed model with --model", requested)
+	default:
+		return requested, nil
+	}
+}
+
+func modelExists(models []string, name string) bool {
+	for _, model := range models {
+		if model == name {
+			return true
+		}
+	}
+	return false
+}
diff --git a/core/cli/chat/session_test.go b/core/cli/chat/session_test.go
new file mode 100644
index 000000000000..dcf274805e3d
--- /dev/null
+++ b/core/cli/chat/session_test.go
@@ -0,0 +1,56 @@
+package chat
+
+import (
+	"context"
+	"io"
+
+	. "github.com/onsi/ginkgo/v2"
+	. "github.com/onsi/gomega"
+)
+
+var _ = Describe("Chat session", func() {
+	It("keeps model switching and message history out of the terminal adapter", func() {
+		client := &fakeChatClient{
+			models: []string{"alpha", "beta"},
+			answer: "pong",
+		}
+
+		session, err := newChatSession(context.Background(), client, "alpha")
+		Expect(err).ToNot(HaveOccurred())
+		Expect(session.CurrentModel()).To(Equal("alpha"))
+
+		Expect(session.SwitchModel("beta")).To(Succeed())
+		Expect(session.CurrentModel()).To(Equal("beta"))
+		Expect(session.Send(context.Background(), "ping", io.Discard)).To(Succeed())
+
+		Expect(client.requests).To(HaveLen(1))
+		Expect(client.requests[0].model).To(Equal("beta"))
+		Expect(client.requests[0].messages).To(HaveLen(1))
+		Expect(client.requests[0].messages[0].Content).To(Equal("ping"))
+	})
+})
+
+type fakeChatClient struct {
+	models   []string
+	answer   string
+	requests []fakeChatRequest
+}
+
+type fakeChatRequest struct {
+	model    string
+	messages []chatMessage
+}
+
+func (c *fakeChatClient) ListModels(context.Context) ([]string, error) {
+	return c.models, nil
+}
+
+func (c *fakeChatClient) StreamChat(_ context.Context, model string, messages []chatMessage, out io.Writer) (string, error) {
+	copied := make([]chatMessage, len(messages))
+	copy(copied, messages)
+	c.requests = append(c.requests, fakeChatRequest{model: model, messages: copied})
+	if _, err := io.WriteString(out, c.answer); err != nil {
+		return "", err
+	}
+	return c.answer, nil
+}
diff --git a/core/cli/chat/terminal.go b/core/cli/chat/terminal.go
new file mode 100644
index 000000000000..c9aebdbe3911
--- /dev/null
+++ b/core/cli/chat/terminal.go
@@ -0,0 +1,70 @@
+package chat
+
+import (
+	"bufio"
+	"context"
+	"fmt"
+	"io"
+	"strings"
+)
+
+func runTerminalChat(ctx context.Context, session *chatSession, in io.Reader, out io.Writer) error {
+	scanner := bufio.NewScanner(in)
+	scanner.Buffer(make([]byte, 0, 64*1024), 4*1024*1024)
+
+	fmt.Fprintf(out, "LocalAI chat (%s)\n", session.CurrentModel())
+	fmt.Fprintln(out, "Type /exit to quit, /clear to reset the conversation, /models to list models.")
+
+	for {
+		fmt.Fprint(out, "\n> ")
+		if !scanner.Scan() {
+			break
+		}
+
+		prompt := strings.TrimSpace(scanner.Text())
+		switch prompt {
+		case "":
+			continue
+		case "/bye", "/exit", "/quit":
+			fmt.Fprintln(out, "bye")
+			return nil
+		case "/clear":
+			session.Clear()
+			fmt.Fprintln(out, "conversation cleared")
+			continue
+		case "/models":
+			printChatModels(out, session.Models(), session.CurrentModel())
+			continue
+		}
+
+		if nextModel, ok := strings.CutPrefix(prompt, "/model "); ok {
+			nextModel = strings.TrimSpace(nextModel)
+			if nextModel == "" {
+				fmt.Fprintln(out, "usage: /model <name>")
+				continue
+			}
+			if err := session.SwitchModel(nextModel); err != nil {
+				fmt.Fprintln(out, err)
+				continue
+			}
+			fmt.Fprintf(out, "switched to %s; conversation cleared\n", session.CurrentModel())
+			continue
+		}
+
+		fmt.Fprint(out, "assistant: ")
+		if err := session.Send(ctx, prompt, out); err != nil {
+			return err
+		}
+		fmt.Fprintln(out)
+	}
+
+	return scanner.Err()
+}
+
+func printChatModels(out io.Writer, models []string, current string) {
+	if len(models) == 0 {
+		fmt.Fprintln(out, "no models installed")
+		return
+	}
+	fmt.Fprint(out, formatChatModelList(models, current))
+}
diff --git a/core/cli/chat_cmd.go b/core/cli/chat_cmd.go
new file mode 100644
index 000000000000..65228ff1f511
--- /dev/null
+++ b/core/cli/chat_cmd.go
@@ -0,0 +1,25 @@
+package cli
+
+import (
+	"context"
+	"os"
+
+	chatcli "github.com/mudler/LocalAI/core/cli/chat"
+	cliContext "github.com/mudler/LocalAI/core/cli/context"
+)
+
+type ChatCMD struct {
+	Model    string `short:"m" help:"Model name to use. Defaults to the only model returned by the server when exactly one is available"`
+	Endpoint string `env:"LOCALAI_CHAT_ENDPOINT" default:"http://127.0.0.1:8080" help:"LocalAI server endpoint. The /v1 path is added automatically when omitted"`
+	APIKey   string `env:"LOCALAI_API_KEY,API_KEY" help:"API key to use when the LocalAI server requires authentication"`
+}
+
+func (c *ChatCMD) Run(ctx *cliContext.Context) error {
+	return chatcli.Run(context.Background(), chatcli.Options{
+		Model:   c.Model,
+		BaseURL: chatAPIBaseURL(c.Endpoint),
+		APIKey:  c.APIKey,
+		In:      os.Stdin,
+		Out:     os.Stdout,
+	})
+}
diff --git a/core/cli/chat_cmd_test.go b/core/cli/chat_cmd_test.go
new file mode 100644
index 000000000000..55ce5014b97e
--- /dev/null
+++ b/core/cli/chat_cmd_test.go
@@ -0,0 +1,27 @@
+package cli
+
+import (
+	. "github.com/onsi/ginkgo/v2"
+	. "github.com/onsi/gomega"
+)
+
+var _ = Describe("Chat command wiring", func() {
+	Describe("chatAPIBaseURL", func() {
+		It("adds /v1 to a root endpoint", func() {
+			Expect(chatAPIBaseURL("http://127.0.0.1:8080")).To(Equal("http://127.0.0.1:8080/v1"))
+		})
+
+		It("keeps endpoints that already include /v1", func() {
+			Expect(chatAPIBaseURL("http://127.0.0.1:8080/v1")).To(Equal("http://127.0.0.1:8080/v1"))
+			Expect(chatAPIBaseURL("http://127.0.0.1:8080/v1/")).To(Equal("http://127.0.0.1:8080/v1"))
+		})
+
+		It("adds a default http scheme", func() {
+			Expect(chatAPIBaseURL("127.0.0.1:8080")).To(Equal("http://127.0.0.1:8080/v1"))
+		})
+
+		It("preserves non-root paths before /v1", func() {
+			Expect(chatAPIBaseURL("http://127.0.0.1:8080/localai")).To(Equal("http://127.0.0.1:8080/localai/v1"))
+		})
+	})
+})
diff --git a/core/cli/chat_endpoint.go b/core/cli/chat_endpoint.go
new file mode 100644
index 000000000000..94f460ae826f
--- /dev/null
+++ b/core/cli/chat_endpoint.go
@@ -0,0 +1,29 @@
+package cli
+
+import (
+	"net/url"
+	"strings"
+)
+
+func chatAPIBaseURL(endpoint string) string {
+	if !strings.Contains(endpoint, "://") {
+		endpoint = "http://" + endpoint
+	}
+
+	u, err := url.Parse(endpoint)
+	if err != nil {
+		return strings.TrimRight(endpoint, "/") + "/v1"
+	}
+
+	path := strings.TrimRight(u.Path, "/")
+	if path == "" {
+		u.Path = "/v1"
+	} else if path != "/v1" && !strings.HasSuffix(path, "/v1") {
+		u.Path = path + "/v1"
+	} else {
+		u.Path = path
+	}
+	u.RawQuery = ""
+	u.Fragment = ""
+	return u.String()
+}
diff --git a/core/cli/cli.go b/core/cli/cli.go
index 88c224ce7edb..8bf4b207a673 100644
--- a/core/cli/cli.go
+++ b/core/cli/cli.go
@@ -9,6 +9,7 @@ var CLI struct {
 	cliContext.Context `embed:""`
 
 	Run             RunCMD             `cmd:"" help:"Run LocalAI, this the default command if no other command is specified. Run 'local-ai run --help' for more information" default:"withargs"`
+	Chat            ChatCMD            `cmd:"" help:"Open an interactive chat session against a running LocalAI server"`
 	Federated       FederatedCLI       `cmd:"" help:"Run LocalAI in federated mode"`
 	Models          ModelsCMD          `cmd:"" help:"Manage LocalAI models and definitions"`
 	Backends        BackendsCMD        `cmd:"" help:"Manage LocalAI backends and definitions"`
diff --git a/core/cli/run.go b/core/cli/run.go
index a2a72077f93c..7b0450d3b0e7 100644
--- a/core/cli/run.go
+++ b/core/cli/run.go
@@ -652,12 +652,12 @@ func (r *RunCMD) Run(ctx *cliContext.Context) error {
 // waitForServerReady polls the given address until the HTTP server is
 // accepting connections or the context is cancelled.
 func waitForServerReady(address string, ctx context.Context) {
-	// Ensure the address has a host component for dialing.
-	// Echo accepts ":8080" but net.Dial needs a resolvable host.
 	host, port, err := net.SplitHostPort(address)
 	if err == nil && host == "" {
 		address = "127.0.0.1:" + port
 	}
+	ticker := time.NewTicker(250 * time.Millisecond)
+	defer ticker.Stop()
 
 	for {
 		select {
@@ -665,11 +665,17 @@ func waitForServerReady(address string, ctx context.Context) {
 			return
 		default:
 		}
+
 		conn, err := net.DialTimeout("tcp", address, 500*time.Millisecond)
 		if err == nil {
 			conn.Close()
 			return
 		}
-		time.Sleep(250 * time.Millisecond)
+
+		select {
+		case <-ctx.Done():
+			return
+		case <-ticker.C:
+		}
 	}
 }
diff --git a/docs/content/getting-started/try-it-out.md b/docs/content/getting-started/try-it-out.md
index 8c2395e894a1..a56e2fca94d2 100644
--- a/docs/content/getting-started/try-it-out.md
+++ b/docs/content/getting-started/try-it-out.md
@@ -20,7 +20,29 @@ With the CLI you can list the models with `local-ai models list` and install the
 You can also [run models manually]({{%relref "getting-started/models" %}}) by copying files into the `models` directory.
  {{% /notice %}}
 
-You can test out the API endpoints using `curl`, few examples are listed below. The models we are referring here (`gpt-4`, `gpt-4-vision-preview`, `tts-1`, `whisper-1`) are examples - replace them with the model names you have installed.
+You can test chat models from the CLI without keeping a separate `curl` command around:
+
+```bash
+# Terminal 1
+local-ai run
+
+# Terminal 2
+local-ai chat --model gpt-4
+```
+
+`local-ai chat` connects to a running LocalAI server, opens an interactive chat prompt, and exits when you type `/exit`, `/quit`, or `/bye`. Use `/models` to list installed models, `/model <name>` to switch models, and `/clear` to reset the current conversation. If the server exposes exactly one model, LocalAI uses that model automatically:
+
+```bash
+# Terminal 1
+local-ai run llama-3.2-1b-instruct:q4_k_m
+
+# Terminal 2
+local-ai chat
+```
+
+When more than one model is configured, pass `--model` with the installed model name to avoid ambiguity. Use `--endpoint` to connect to a non-default server, for example `local-ai chat --endpoint http://127.0.0.1:8081 --model gpt-4`.
+
+You can also test out the API endpoints using `curl`, few examples are listed below. The models we are referring here (`gpt-4`, `gpt-4-vision-preview`, `tts-1`, `whisper-1`) are examples - replace them with the model names you have installed.
 
 ### Text Generation
 
diff --git a/docs/content/reference/cli-reference.md b/docs/content/reference/cli-reference.md
index 556cf5a995e9..685b873773f6 100644
--- a/docs/content/reference/cli-reference.md
+++ b/docs/content/reference/cli-reference.md
@@ -118,6 +118,21 @@ For more information on VRAM management, see [VRAM and Memory Management]({{%rel
 
 See [Authentication & Authorization]({{%relref "features/authentication" %}}) for full documentation.
 
+## Chat Flags
+
+Use `local-ai chat` to open an interactive terminal chat session against a running LocalAI server.
+
+| Parameter | Default | Description | Environment Variable |
+|-----------|---------|-------------|----------------------|
+| `--endpoint` | `http://127.0.0.1:8080` | LocalAI server endpoint. The `/v1` path is added automatically when omitted. | `$LOCALAI_CHAT_ENDPOINT` |
+| `--model` | | Model name to use. If omitted, LocalAI uses the only model returned by the server when exactly one is available. | |
+| `--api-key` | | API key to use when the LocalAI server requires authentication. | `$LOCALAI_API_KEY`, `$API_KEY` |
+
+- Inside the chat prompt:
+  - Use `/models` to list installed models.
+  - Use `/model <name>` to switch to a different model and clear the conversation.
+  - Use `/clear` to reset the current conversation.
+
 ## P2P Flags
 
 | Parameter | Default | Description | Environment Variable |
@@ -181,4 +196,3 @@ export LOCALAI_F16=true
 
 - See [Advanced Usage]({{%relref "advanced/advanced-usage" %}}) for configuration examples
 - See [VRAM and Memory Management]({{%relref "advanced/vram-management" %}}) for memory management options
-