diff --git a/.env.example b/.env.example
new file mode 100644
index 0000000..ce40fdd
--- /dev/null
+++ b/.env.example
@@ -0,0 +1,6 @@
+# OpenAI API Configuration
+OPENAI_API_KEY=your_openai_api_key_here
+
+# Application Configuration
+PORT=3000
+NODE_ENV=development
diff --git a/.gitignore b/.gitignore
index 58ab67f..31729f4 100644
--- a/.gitignore
+++ b/.gitignore
@@ -1,2 +1,24 @@
 *.agdai
 MAlonzo/**
+
+# Node.js
+node_modules/
+npm-debug.log
+yarn-error.log
+package-lock.json
+
+# Environment variables
+.env
+
+# Python
+__pycache__/
+*.py[cod]
+*$py.class
+*.so
+.Python
+venv/
+env/
+ENV/
+*.egg-info/
+dist/
+build/
diff --git a/README.md b/README.md
index 25041f3..8dc3497 100644
--- a/README.md
+++ b/README.md
@@ -1 +1,180 @@
-# Web3AI
\ No newline at end of file
+# Web3AI
+
+Web3AI is an AI-powered blockchain and Web3 development toolkit that integrates OpenAI's capabilities with blockchain technologies.
+
+## 🌟 Features
+
+- **Node.js Backend**: Server-side JavaScript for Web3 applications
+- **OpenAI Integration**: AI-powered smart contract analysis, code generation, and blockchain insights
+- **Python AI Scripts**: Advanced AI capabilities for blockchain development
+- **Modular Architecture**: Easy to extend with additional AI or blockchain features
+
+## 📋 Prerequisites
+
+Before you begin, ensure you have the following installed:
+
+- **Node.js** (v14 or higher) - [Download here](https://nodejs.org/)
+- **npm** (comes with Node.js)
+- **Python** (v3.8 or higher) - [Download here](https://www.python.org/downloads/)
+- **pip** (comes with Python)
+
+## 🚀 Getting Started
+
+### 1. Clone the Repository
+
+```bash
+git clone https://github.com/lippytm/Web3AI.git
+cd Web3AI
+```
+
+### 2. Set Up Node.js Environment
+
+Install Node.js dependencies:
+
+```bash
+npm install
+```
+
+### 3. Set Up Python Environment (Optional)
+
+For Python AI scripts, install required packages:
+
+```bash
+pip install -r requirements.txt
+```
+
+Or create a virtual environment (recommended):
+
+```bash
+# Create virtual environment
+python -m venv venv
+
+# Activate virtual environment
+# On Windows:
+venv\Scripts\activate
+# On macOS/Linux:
+source venv/bin/activate
+
+# Install dependencies
+pip install -r requirements.txt
+```
+
+### 4. Configure OpenAI API Key
+
+1. **Get your OpenAI API key**:
+   - Visit [OpenAI Platform](https://platform.openai.com/api-keys)
+   - Sign in or create an account
+   - Navigate to API Keys section
+   - Click "Create new secret key"
+   - Copy your API key (you won't be able to see it again!)
+
+2. **Set up environment variables**:
+
+```bash
+# Copy the example environment file
+cp .env.example .env
+
+# Edit .env and add your API key
+# Replace 'your_openai_api_key_here' with your actual API key
+```
+
+Your `.env` file should look like this:
+
+```
+OPENAI_API_KEY=sk-your-actual-api-key-here
+PORT=3000
+NODE_ENV=development
+```
+
+⚠️ **Important**: Never commit your `.env` file to version control. It's already included in `.gitignore`.
+
+## 🎯 Usage
+
+### Running the Node.js Application
+
+Start the main application:
+
+```bash
+npm start
+```
+
+This will run the OpenAI integration demo and show you how to interact with AI models.
+
+### Running Python AI Scripts
+
+Execute the sample AI script:
+
+```bash
+python ai_scripts/sample_ai.py
+```
+
+This demonstrates:
+- Explaining Web3 concepts using AI
+- Analyzing smart contract code
+- Integration with OpenAI's Python library
+
+## 📁 Project Structure
+
+```
+Web3AI/
+├── backend/              # Node.js backend code
+│   └── openai.js        # OpenAI API integration module
+├── ai_scripts/          # Python AI scripts
+│   └── sample_ai.py     # Sample AI functionality demo
+├── .env.example         # Environment variable template
+├── .gitignore          # Git ignore rules
+├── index.js            # Main entry point
+├── package.json        # Node.js dependencies and scripts
+├── requirements.txt    # Python dependencies
+└── README.md           # This file
+```
+
+## 🔧 Available Scripts
+
+- `npm start` - Run the main application
+- `npm test` - Run tests (to be implemented)
+
+## 🤝 Contributing
+
+Contributions are welcome! Please feel free to submit a Pull Request.
+
+## 📝 License
+
+This project is licensed under the ISC License.
+
+## 🆘 Troubleshooting
+
+### "OpenAI API key not configured" Error
+
+Make sure you have:
+1. Created a `.env` file in the project root
+2. Added your OpenAI API key to the `.env` file
+3. The key starts with `sk-`
+
+### "Module not found" Error
+
+Run `npm install` to install Node.js dependencies or `pip install openai python-dotenv` for Python.
+
+### Python Import Errors
+
+Make sure you have activated your virtual environment (if using one) and installed all required packages.
+
+## 🔮 Future Enhancements
+
+- Integration with blockchain networks (Ethereum, Polygon, etc.)
+- Smart contract deployment automation
+- AI-powered security auditing
+- Web3 wallet integration
+- NFT generation and analysis
+- DeFi protocol interaction
+
+## 📚 Resources
+
+- [OpenAI API Documentation](https://platform.openai.com/docs)
+- [Node.js Documentation](https://nodejs.org/docs)
+- [Python OpenAI Library](https://github.com/openai/openai-python)
+- [Web3.js Documentation](https://web3js.readthedocs.io/)
+
+---
+
+Made with ❤️ for the Web3 and AI community
diff --git a/ai_scripts/sample_ai.py b/ai_scripts/sample_ai.py
new file mode 100644
index 0000000..45ca461
--- /dev/null
+++ b/ai_scripts/sample_ai.py
@@ -0,0 +1,180 @@
+#!/usr/bin/env python3
+"""
+Web3AI - Python AI Script Example
+
+This script demonstrates how to use OpenAI's Python library to interact
+with AI models for Web3 and blockchain-related tasks.
+
+Requirements:
+    pip install openai python-dotenv
+"""
+
+import os
+from dotenv import load_dotenv
+
+# Load environment variables from .env file
+load_dotenv()
+
+
+def setup_openai():
+    """
+    Initialize OpenAI client with API key from environment
+    """
+    try:
+        from openai import OpenAI
+        
+        api_key = os.getenv('OPENAI_API_KEY')
+        
+        if not api_key or api_key == 'your_openai_api_key_here':
+            print('⚠️  Warning: OpenAI API key not configured!')
+            print('📝 Please set OPENAI_API_KEY in your .env file')
+            return None
+        
+        client = OpenAI(api_key=api_key)
+        print('✅ OpenAI client initialized successfully\n')
+        return client
+        
+    except ImportError:
+        print('❌ Error: openai package not installed')
+        print('   Install it with: pip install openai')
+        return None
+
+
+def analyze_smart_contract(client, contract_code):
+    """
+    Example function to analyze smart contract code using AI
+    
+    Args:
+        client: OpenAI client instance
+        contract_code: Smart contract code to analyze
+    
+    Returns:
+        AI analysis of the contract
+    """
+    if not client:
+        return "Client not initialized"
+    
+    try:
+        response = client.chat.completions.create(
+            model="gpt-3.5-turbo",
+            messages=[
+                {
+                    "role": "system",
+                    "content": "You are an expert in blockchain and smart contract security. Analyze smart contracts for potential vulnerabilities and best practices."
+                },
+                {
+                    "role": "user",
+                    "content": f"Analyze this smart contract code:\n\n{contract_code}"
+                }
+            ],
+            max_tokens=300,
+            temperature=0.5
+        )
+        
+        return response.choices[0].message.content
+        
+    except Exception as e:
+        return f"Error analyzing contract: {str(e)}"
+
+
+def explain_web3_concept(client, concept):
+    """
+    Get AI explanation of Web3 concepts
+    
+    Args:
+        client: OpenAI client instance
+        concept: Web3 concept to explain
+    
+    Returns:
+        AI explanation
+    """
+    if not client:
+        return "Client not initialized"
+    
+    try:
+        response = client.chat.completions.create(
+            model="gpt-3.5-turbo",
+            messages=[
+                {
+                    "role": "system",
+                    "content": "You are a Web3 educator. Explain blockchain and Web3 concepts in simple, clear terms."
+                },
+                {
+                    "role": "user",
+                    "content": f"Explain: {concept}"
+                }
+            ],
+            max_tokens=200,
+            temperature=0.7
+        )
+        
+        return response.choices[0].message.content
+        
+    except Exception as e:
+        return f"Error getting explanation: {str(e)}"
+
+
+def run_demo():
+    """
+    Run demonstration of AI capabilities
+    """
+    print('🚀 Web3AI Python Demo')
+    print('=' * 50)
+    print()
+    
+    # Initialize OpenAI client
+    client = setup_openai()
+    
+    if not client:
+        print('\n💡 To run this demo:')
+        print('   1. Install dependencies: pip install openai python-dotenv')
+        print('   2. Set OPENAI_API_KEY in .env file')
+        print('   3. Get API key from: https://platform.openai.com/api-keys')
+        return
+    
+    # Demo 1: Explain a Web3 concept
+    print('📚 Demo 1: Explaining Web3 Concepts')
+    print('-' * 50)
+    concept = "What is a blockchain consensus mechanism?"
+    print(f'Question: {concept}\n')
+    print('Thinking... 🤔\n')
+    
+    explanation = explain_web3_concept(client, concept)
+    print('AI Response:')
+    print(explanation)
+    print()
+    
+    # Demo 2: Smart contract analysis
+    print('\n🔍 Demo 2: Smart Contract Analysis')
+    print('-' * 50)
+    
+    sample_contract = """
+    pragma solidity ^0.8.0;
+    
+    contract SimpleStorage {
+        uint256 private data;
+        
+        function set(uint256 _data) public {
+            data = _data;
+        }
+        
+        function get() public view returns (uint256) {
+            return data;
+        }
+    }
+    """
+    
+    print('Analyzing sample Solidity contract...\n')
+    print('Thinking... 🤔\n')
+    
+    analysis = analyze_smart_contract(client, sample_contract)
+    print('AI Analysis:')
+    print(analysis)
+    print()
+    
+    print('\n✅ Demo completed successfully!')
+    print('=' * 50)
+
+
+if __name__ == '__main__':
+    run_demo()
diff --git a/backend/openai.js b/backend/openai.js
new file mode 100644
index 0000000..a763476
--- /dev/null
+++ b/backend/openai.js
@@ -0,0 +1,75 @@
+/**
+ * OpenAI Integration Module
+ * 
+ * This module demonstrates how to interact with OpenAI's API using the official SDK.
+ * It includes examples of using GPT models for various AI tasks.
+ */
+
+const OpenAI = require('openai');
+
+// Initialize OpenAI client
+const openai = new OpenAI({
+  apiKey: process.env.OPENAI_API_KEY,
+});
+
+/**
+ * Simple chat completion example
+ * Demonstrates basic interaction with GPT models
+ */
+async function chatCompletion(prompt) {
+  try {
+    const completion = await openai.chat.completions.create({
+      model: "gpt-3.5-turbo",
+      messages: [
+        {
+          role: "system",
+          content: "You are a helpful AI assistant specialized in Web3 and blockchain technologies."
+        },
+        {
+          role: "user",
+          content: prompt
+        }
+      ],
+      max_tokens: 150,
+      temperature: 0.7,
+    });
+
+    return completion.choices[0].message.content;
+  } catch (error) {
+    console.error('Error calling OpenAI API:', error.message);
+    throw error;
+  }
+}
+
+/**
+ * Run a demo of the OpenAI integration
+ */
+async function runDemo() {
+  console.log('🤖 OpenAI Integration Demo');
+  console.log('─────────────────────────────\n');
+
+  try {
+    const prompt = "What is Web3 and how does AI enhance blockchain development?";
+    console.log(`Question: ${prompt}\n`);
+    
+    console.log('Thinking... 🤔\n');
+    const response = await chatCompletion(prompt);
+    
+    console.log('AI Response:');
+    console.log('─────────────────────────────');
+    console.log(response);
+    console.log('─────────────────────────────\n');
+    
+    console.log('✅ Demo completed successfully!\n');
+  } catch (error) {
+    console.error('❌ Demo failed:', error.message);
+    if (error.status === 401) {
+      console.error('   Invalid API key. Please check your OPENAI_API_KEY in .env file.');
+    }
+  }
+}
+
+module.exports = {
+  chatCompletion,
+  runDemo,
+};
diff --git a/index.js b/index.js
new file mode 100644
index 0000000..2a9806c
--- /dev/null
+++ b/index.js
@@ -0,0 +1,35 @@
+/**
+ * Web3AI - Main Entry Point
+ * 
+ * This is the main entry point for the Web3AI application.
+ * It demonstrates the integration of AI capabilities with Web3 technologies.
+ */
+
+require('dotenv').config();
+
+console.log('🚀 Welcome to Web3AI!');
+console.log('==========================================');
+console.log('A toolkit for AI-powered Web3 development');
+console.log('==========================================\n');
+
+// Check if OpenAI API key is configured
+if (!process.env.OPENAI_API_KEY || process.env.OPENAI_API_KEY === 'your_openai_api_key_here') {
+  console.warn('⚠️  Warning: OpenAI API key not configured!');
+  console.log('📝 Please create a .env file based on .env.example');
+  console.log('   and add your OpenAI API key.\n');
+} else {
+  console.log('✅ OpenAI API key configured\n');
+}
+
+// Import and run OpenAI demo if API key is set
+if (process.env.OPENAI_API_KEY && process.env.OPENAI_API_KEY !== 'your_openai_api_key_here') {
+  const openaiDemo = require('./backend/openai');
+  
+  console.log('Running OpenAI integration demo...\n');
+  openaiDemo.runDemo().catch(error => {
+    console.error('Error running OpenAI demo:', error.message);
+  });
+} else {
+  console.log('💡 Set up your API key to run the OpenAI demo.');
+  console.log('   Get your API key from: https://platform.openai.com/api-keys\n');
+}
diff --git a/package.json b/package.json
new file mode 100644
index 0000000..2ef5ada
--- /dev/null
+++ b/package.json
@@ -0,0 +1,22 @@
+{
+  "name": "web3ai",
+  "version": "1.0.0",
+  "description": "Web3AI - AI-powered blockchain and Web3 development toolkit",
+  "main": "index.js",
+  "scripts": {
+    "start": "node index.js",
+    "test": "echo \"Error: no test specified\" && exit 1"
+  },
+  "keywords": [
+    "web3",
+    "ai",
+    "blockchain",
+    "openai"
+  ],
+  "author": "",
+  "license": "ISC",
+  "dependencies": {
+    "dotenv": "^17.2.3",
+    "openai": "^6.10.0"
+  }
+}
diff --git a/requirements.txt b/requirements.txt
new file mode 100644
index 0000000..5ab3a8d
--- /dev/null
+++ b/requirements.txt
@@ -0,0 +1,3 @@
+# Python dependencies for Web3AI
+openai>=1.0.0
+python-dotenv>=1.0.0