Supercharge Your VS Code with AI: Local Models for Data Privacy

Unleashing AI in Development Without Compromising Privacy

AI has become the ultimate co-pilot for developers, helping them build enterprise-level applications faster and more efficiently. From GitHub Copilot to ChatGPT to DeepSeek, these AI tools provide impressive coding assistance. But, as with all great power, there’s a catch data privacy.

Most of these AI-powered tools run in the cloud, meaning your code is being sent to external servers. Even if companies claim not to store or analyze your data, can we truly be sure of what happens behind the scenes? This risk becomes even more significant when working with proprietary or confidential code. For enterprises dealing with sensitive data, using cloud-based AI models could land them in legal and security trouble.

Some developers argue that an enterprise subscription offers better privacy protection, but does it really? The fundamental issue remains: once your code leaves your system, you lose control over it.

So, how do we fully leverage AI while keeping our data secure?

The answer lies in open-source AI models that run locally on your machine. And one of the most powerful models available today is DeepSeek-R1. With the right setup, you can harness AI’s full potential for autocompletion, code generation, and debugging all while ensuring your code never leaves your PC.

In this guide, we’ll walk you through:

• Installing DeepSeek-R1 locally using Ollama.
• Setting up continue.dev to integrate AI-driven code completion seamlessly into VS Code.
• Using the DeepSeek coding model to enhance your developer experience.

Let’s get started!

Step 1: Installing DeepSeek-R1 Locally with Ollama

Before we dive into coding, we need a local AI model running on our system. DeepSeek-R1 is a powerful open-source LLM that can be installed and run without internet dependency, keeping all operations private.

Prerequisites:

• A Linux, Mac, or Windows (WSL recommended) system
• A decent GPU (NVIDIA recommended for best performance)
• At least 16GB RAM (more is better for handling large models)
• Ollama installed

Installing Ollama

Ollama is a framework that allows you to run large language models efficiently on your local machine. To install it:

For macOS & Linux:

curl -fsSL https://ollama.ai/install.sh | sh

For Windows:

1. Download the latest Ollama installer from Ollama’s official site.
2. Run the installer and follow the setup instructions.

Installing DeepSeek-R1 Model

Once Ollama is installed, you can download and run the DeepSeek-R1 model by executing:

ollama pull deepseek-r1:7b

This command downloads and sets up the DeepSeek-R1 model on your local system. Depending on your internet speed, it may take a few minutes.

To test the installation, run:

ollama run deepseek-r1:7b

If everything is set up correctly, you should see the model responding to your prompts locally!

Step 2: Installing Continue.dev for AI-Powered Coding

Now that we have our AI model running locally, the next step is to integrate it with VS Code for an enhanced coding experience. This is where continue.dev comes in.

What is Continue.dev?

Continue.dev is an open-source AI extension for VS Code that allows developers to use custom AI models for code completion, autocompletion, and in-editor assistance.

Installing Continue.dev

1. Open VS Code.
2. Go to Extensions (Ctrl + Shift + X).
3. Search for Continue.dev.
4. Click Install.

Once installed, you’ll see the Continue.dev icon in the activity bar.

Configuring Continue.dev to Use DeepSeek-R1

Now, we need to configure Continue.dev to use DeepSeek-R1 instead of cloud-based models.

1. Open the Continue.dev settings in VS Code.
2. Locate the model provider settings.
3. Select Custom Model.
4. Set the API endpoint to:
   http://localhost:11434/v1
5. Choose the DeepSeek-R1 model from the list (or add it manually if needed).
6. Save the settings and restart VS Code.

That’s it! Continue.dev is now configured to use DeepSeek-R1 for local AI-powered code completion.

Step 3: Supercharge Your Coding Experience

With Continue.dev and DeepSeek-R1 set up, you can now enjoy AI-assisted coding without compromising privacy. Here’s what you can do:

1. AI Autocompletion

• Write a function, and watch AI-complete it intelligently.
• Get real-time code suggestions based on context.

2. Code Refactoring & Optimization

• Select any function or block of code and ask AI to optimize it.
• Improve code efficiency with performance recommendations.

3. Debugging Assistance

• Explain errors to the AI and get real-time fixes.
• Understand complex error messages in simple terms.

4. AI-Powered Documentation

• Generate instant docstrings for your functions.
• Auto-generate comments to improve readability.

Why Choose Local AI Over Cloud AI?

By running DeepSeek-R1 locally, you:

✅ Keep your code 100% private — nothing leaves your machine.

✅ Avoid subscription fees — no need to pay for cloud-based AI services.

✅ Gain full control — train and fine-tune the model for better performance.

✅ Work offline — no internet? No problem!

Of course, the performance of your AI assistant depends on your hardware capabilities, but with model fine-tuning and optimization, you can strike a balance between speed and accuracy.

Final Thoughts: The Future of AI-Powered Development

The world is rapidly moving towards AI-driven coding, but data privacy concerns remain. Instead of compromising security, developers can now harness the power of AI locally using tools like DeepSeek-R1 and Continue.dev.

With this setup, you can enjoy AI-assisted development with complete peace of mind, knowing that your code remains within your machine.

So, what are you waiting for? Supercharge your VS Code today and experience the future of coding — safely and privately! 🚀