diff --git a/CLAUDE.md b/CLAUDE.md
index 373d1c9..1dc6a79 100644
--- a/CLAUDE.md
+++ b/CLAUDE.md
@@ -87,12 +87,13 @@ uv run ruff format gpu_test/
 
 - **Stack Type**: `!forth.stack` - untyped stack, programmer ensures type safety
 - **Operations**: All take stack as input and produce stack as output (except `forth.stack`)
-- **Supported Words**: literals (integer `42` and float `3.14`), `DUP DROP SWAP OVER ROT NIP TUCK PICK ROLL`, `+ - * / MOD`, `F+ F- F* F/` (float arithmetic), `AND OR XOR NOT LSHIFT RSHIFT`, `= < > <> <= >= 0=`, `F= F< F> F<> F<= F>=` (float comparison), `S>F F>S` (int/float conversion), `@ !` (global memory), `F@ F!` (float global memory), `S@ S!` (shared memory), `SF@ SF!` (float shared memory), `CELLS`, `IF ELSE THEN`, `BEGIN UNTIL`, `BEGIN WHILE REPEAT`, `DO LOOP +LOOP I J K`, `LEAVE UNLOOP EXIT`, `TID-X/Y/Z BID-X/Y/Z BDIM-X/Y/Z GDIM-X/Y/Z GLOBAL-ID` (GPU indexing).
+- **Supported Words**: literals (integer `42` and float `3.14`), `DUP DROP SWAP OVER ROT NIP TUCK PICK ROLL`, `+ - * / MOD`, `F+ F- F* F/` (float arithmetic), `AND OR XOR NOT LSHIFT RSHIFT`, `= < > <> <= >= 0=`, `F= F< F> F<> F<= F>=` (float comparison), `S>F F>S` (int/float conversion), `@ !` (global memory), `F@ F!` (float global memory), `S@ S!` (shared memory), `SF@ SF!` (float shared memory), `CELLS`, `IF ELSE THEN`, `BEGIN UNTIL`, `BEGIN WHILE REPEAT`, `DO LOOP +LOOP I J K`, `LEAVE UNLOOP EXIT`, `{ a b -- }` (local variables in word definitions), `TID-X/Y/Z BID-X/Y/Z BDIM-X/Y/Z GDIM-X/Y/Z GLOBAL-ID` (GPU indexing).
 - **Float Literals**: Numbers containing `.` or `e`/`E` are parsed as f64 (e.g. `3.14`, `-2.0`, `1.0e-5`, `1e3`). Stored on the stack as i64 bit patterns; F-prefixed words perform bitcast before/after operations.
 - **Kernel Parameters**: Declared in the `\!` header. `\! kernel <name>` is required and must appear first. `\! param <name> i64[<N>]` becomes a `memref<Nxi64>` argument; `\! param <name> i64` becomes an `i64` argument. `\! param <name> f64[<N>]` becomes a `memref<Nxf64>` argument; `\! param <name> f64` becomes an `f64` argument (bitcast to i64 when pushed to stack). Using a param name in code emits `forth.param_ref` (arrays push address; scalars push value).
 - **Shared Memory**: `\! shared <name> i64[<N>]` or `\! shared <name> f64[<N>]` declares GPU shared (workgroup) memory. Emits a tagged `memref.alloca` at kernel entry; ForthToGPU converts it to a `gpu.func` workgroup attribution. Using the shared name in code pushes its base address onto the stack. Use `S@`/`S!` for i64 or `SF@`/`SF!` for f64 shared accesses. Cannot be referenced inside word definitions.
 - **Conversion**: `!forth.stack` → `memref<256xi64>` with explicit stack pointer
 - **GPU**: Functions wrapped in `gpu.module`, `main` gets `gpu.kernel` attribute, configured with bare pointers for NVVM conversion
+- **Local Variables**: `{ a b c -- }` at the start of a word definition binds read-only locals. Pops values from the stack in reverse name order (c, b, a) using `forth.pop`, stores SSA values. Referencing a local emits `forth.push_value`. SSA values from the entry block dominate all control flow, so locals work across IF/ELSE/THEN, loops, etc. On GPU, locals map directly to registers.
 - **User-defined Words**: Modeled as `func.func` with signature `(!forth.stack) -> !forth.stack`, called via `func.call`
 
 ## Conventions
diff --git a/lib/Translation/ForthToMLIR/ForthToMLIR.cpp b/lib/Translation/ForthToMLIR/ForthToMLIR.cpp
index aebb7e8..e64dab8 100644
--- a/lib/Translation/ForthToMLIR/ForthToMLIR.cpp
+++ b/lib/Translation/ForthToMLIR/ForthToMLIR.cpp
@@ -409,6 +409,16 @@ Value ForthParser::emitOperation(StringRef word, Value inputStack,
                                  Location loc) {
   Type stackType = forth::StackType::get(context);
 
+  // Check if word is a local variable (only valid inside word definitions)
+  if (inWordDefinition) {
+    auto it = localVars.find(word);
+    if (it != localVars.end()) {
+      return builder
+          .create<forth::PushValueOp>(loc, stackType, inputStack, it->second)
+          .getOutputStack();
+    }
+  }
+
   // Check if word is a param name (only valid outside word definitions)
   if (!inWordDefinition) {
     for (const auto &param : paramDecls) {
@@ -994,6 +1004,11 @@ LogicalResult ForthParser::parseBody(Value &stack) {
         Value step = popOp.getValue();
         emitLoopEnd(loc, ctx, step, stack);
 
+        //=== { outside word definition ===
+      } else if (currentToken.text == "{") {
+        return emitError(
+            "local variables can only be declared inside a word definition");
+
         //=== Normal word ===
       } else {
         Value newStack = emitOperation(currentToken.text, stack, loc);
@@ -1014,6 +1029,84 @@ LogicalResult ForthParser::parseBody(Value &stack) {
 // Word definition and top-level parsing.
 //===----------------------------------------------------------------------===//
 
+LogicalResult ForthParser::parseLocals(Value &stack) {
+  // If current token is not '{', no locals to parse
+  if (currentToken.kind != Token::Kind::Word || currentToken.text != "{")
+    return success();
+
+  Location loc = getLoc();
+  consume(); // consume '{'
+
+  // Collect local names until '--' or '}'
+  SmallVector<std::string> names;
+  while (currentToken.kind != Token::Kind::EndOfFile) {
+    if (currentToken.kind == Token::Kind::Word && currentToken.text == "--")
+      break;
+    if (currentToken.kind == Token::Kind::Word && currentToken.text == "}")
+      break;
+
+    if (currentToken.kind != Token::Kind::Word)
+      return emitError("expected local variable name in { ... }");
+
+    std::string name = currentToken.text; // already uppercased by lexer
+
+    // Check for duplicate local names
+    for (const auto &existing : names) {
+      if (existing == name)
+        return emitError("duplicate local variable name: " + name);
+    }
+
+    // Check for conflicts with param names
+    for (const auto &param : paramDecls) {
+      if (param.name == name)
+        return emitError("local variable name '" + name +
+                         "' conflicts with parameter name");
+    }
+
+    // Check for conflicts with shared names
+    for (const auto &shared : sharedDecls) {
+      if (shared.name == name)
+        return emitError("local variable name '" + name +
+                         "' conflicts with shared memory name");
+    }
+
+    names.push_back(name);
+    consume();
+  }
+
+  // Skip '--' and output names until '}'. Per ANS Forth, output names are
+  // documentation-only and have no semantic effect; we intentionally ignore
+  // them.
+  if (currentToken.kind == Token::Kind::Word && currentToken.text == "--") {
+    consume(); // consume '--'
+    while (currentToken.kind != Token::Kind::EndOfFile) {
+      if (currentToken.kind == Token::Kind::Word && currentToken.text == "}")
+        break;
+      consume(); // skip output names (ignored)
+    }
+  }
+
+  if (currentToken.kind != Token::Kind::Word || currentToken.text != "}")
+    return emitError("expected '}' to close local variable declaration");
+
+  consume(); // consume '}'
+
+  if (names.empty())
+    return success();
+
+  // Pop values in reverse order: { a b c -- } with stack ( 1 2 3 )
+  // pops 3->c, 2->b, 1->a
+  Type i64Type = builder.getI64Type();
+  Type stackType = forth::StackType::get(context);
+  for (int i = names.size() - 1; i >= 0; --i) {
+    auto popOp = builder.create<forth::PopOp>(loc, stackType, i64Type, stack);
+    stack = popOp.getOutputStack();
+    localVars[names[i]] = popOp.getValue();
+  }
+
+  return success();
+}
+
 LogicalResult ForthParser::parseWordDefinition() {
   Location loc = getLoc();
   auto savedInsertionPoint = builder.saveInsertionPoint();
@@ -1039,6 +1132,10 @@ LogicalResult ForthParser::parseWordDefinition() {
   Value resultStack = entryBlock->getArgument(0);
   builder.setInsertionPointToStart(entryBlock);
 
+  // Parse local variable declarations (if any)
+  if (failed(parseLocals(resultStack)))
+    return failure();
+
   // Parse word body until ';'
   if (failed(parseBody(resultStack)))
     return failure();
@@ -1057,6 +1154,7 @@ LogicalResult ForthParser::parseWordDefinition() {
   consume(); // consume ';'
 
   inWordDefinition = false;
+  localVars.clear();
 
   // Restore insertion point
   builder.restoreInsertionPoint(savedInsertionPoint);
diff --git a/lib/Translation/ForthToMLIR/ForthToMLIR.h b/lib/Translation/ForthToMLIR/ForthToMLIR.h
index 6aa4809..4059e02 100644
--- a/lib/Translation/ForthToMLIR/ForthToMLIR.h
+++ b/lib/Translation/ForthToMLIR/ForthToMLIR.h
@@ -101,6 +101,7 @@ class ForthParser {
   std::vector<ParamDecl> paramDecls;
   std::vector<SharedDecl> sharedDecls;
   llvm::StringMap<Value> sharedAllocs;
+  llvm::StringMap<Value> localVars;
   std::string kernelName;
   const char *headerEndPtr = nullptr;
   bool inWordDefinition = false;
@@ -159,6 +160,9 @@ class ForthParser {
   void emitLoopEnd(Location loc, const LoopContext &ctx, Value step,
                    Value &stack);
 
+  /// Parse local variable declarations: { a b c -- }
+  LogicalResult parseLocals(Value &stack);
+
   /// Parse a user-defined word definition.
   LogicalResult parseWordDefinition();
 };
diff --git a/test/Pipeline/local-variables.forth b/test/Pipeline/local-variables.forth
new file mode 100644
index 0000000..4e907c2
--- /dev/null
+++ b/test/Pipeline/local-variables.forth
@@ -0,0 +1,10 @@
+\ RUN: %warpforth-translate --forth-to-mlir %s | %warpforth-opt --warpforth-pipeline | %FileCheck %s
+
+\ Verify that local variables compile through the full pipeline to gpu.binary.
+\ CHECK: gpu.binary @warpforth_module
+
+\! kernel main
+\! param DATA i64[256]
+: ADD3 { a b c -- } a b + c + ;
+1 2 3 ADD3
+GLOBAL-ID CELLS DATA + !
diff --git a/test/Translation/Forth/local-variables-control-flow.forth b/test/Translation/Forth/local-variables-control-flow.forth
new file mode 100644
index 0000000..1cd259f
--- /dev/null
+++ b/test/Translation/Forth/local-variables-control-flow.forth
@@ -0,0 +1,19 @@
+\ RUN: %warpforth-translate --forth-to-mlir %s | %FileCheck %s
+
+\ Test that locals work across IF/ELSE/THEN control flow.
+\ SSA values defined in the entry block dominate all subsequent blocks.
+
+\ CHECK: func.func private @CLAMP(%arg0: !forth.stack) -> !forth.stack {
+\ CHECK:   forth.pop
+\ CHECK:   forth.pop
+\ CHECK:   forth.pop
+\ CHECK:   forth.push_value
+\ CHECK:   forth.push_value
+\ CHECK:   forth.push_value
+
+\! kernel main
+: CLAMP { val lo hi -- }
+  val lo < IF lo ELSE
+  val hi > IF hi ELSE
+  val THEN THEN ;
+0 10 5 CLAMP
diff --git a/test/Translation/Forth/local-variables-error-outside-word.forth b/test/Translation/Forth/local-variables-error-outside-word.forth
new file mode 100644
index 0000000..1fc955a
--- /dev/null
+++ b/test/Translation/Forth/local-variables-error-outside-word.forth
@@ -0,0 +1,4 @@
+\ RUN: %not %warpforth-translate --forth-to-mlir %s 2>&1 | %FileCheck %s
+\ CHECK: local variables can only be declared inside a word definition
+\! kernel main
+{ x y -- }
diff --git a/test/Translation/Forth/local-variables-error-param-conflict.forth b/test/Translation/Forth/local-variables-error-param-conflict.forth
new file mode 100644
index 0000000..edfb7dc
--- /dev/null
+++ b/test/Translation/Forth/local-variables-error-param-conflict.forth
@@ -0,0 +1,6 @@
+\ RUN: %not %warpforth-translate --forth-to-mlir %s 2>&1 | %FileCheck %s
+\ CHECK: local variable name 'DATA' conflicts with parameter name
+\! kernel main
+\! param DATA i64[256]
+: BAD { data -- } data ;
+BAD
diff --git a/test/Translation/Forth/local-variables-error-shared-conflict.forth b/test/Translation/Forth/local-variables-error-shared-conflict.forth
new file mode 100644
index 0000000..12b8fba
--- /dev/null
+++ b/test/Translation/Forth/local-variables-error-shared-conflict.forth
@@ -0,0 +1,6 @@
+\ RUN: %not %warpforth-translate --forth-to-mlir %s 2>&1 | %FileCheck %s
+\ CHECK: local variable name 'BUF' conflicts with shared memory name
+\! kernel main
+\! shared BUF i64[64]
+: BAD { buf -- } buf ;
+BAD
diff --git a/test/Translation/Forth/local-variables-error.forth b/test/Translation/Forth/local-variables-error.forth
new file mode 100644
index 0000000..f73121b
--- /dev/null
+++ b/test/Translation/Forth/local-variables-error.forth
@@ -0,0 +1,5 @@
+\ RUN: %not %warpforth-translate --forth-to-mlir %s 2>&1 | %FileCheck %s
+\ CHECK: duplicate local variable name: X
+\! kernel main
+: BAD { x y x -- } x ;
+BAD
diff --git a/test/Translation/Forth/local-variables.forth b/test/Translation/Forth/local-variables.forth
new file mode 100644
index 0000000..470d9d8
--- /dev/null
+++ b/test/Translation/Forth/local-variables.forth
@@ -0,0 +1,27 @@
+\ RUN: %warpforth-translate --forth-to-mlir %s | %FileCheck %s
+
+\ Test basic local variable binding and reference.
+
+\ CHECK: func.func private @ADD3(%arg0: !forth.stack) -> !forth.stack {
+\ CHECK:   forth.pop %arg0 : !forth.stack -> !forth.stack, i64
+\ CHECK:   forth.pop %{{.*}} : !forth.stack -> !forth.stack, i64
+\ CHECK:   forth.pop %{{.*}} : !forth.stack -> !forth.stack, i64
+\ CHECK:   forth.push_value %{{.*}}, %{{.*}} : !forth.stack, i64 -> !forth.stack
+\ CHECK:   forth.push_value %{{.*}}, %{{.*}} : !forth.stack, i64 -> !forth.stack
+\ CHECK:   forth.addi
+\ CHECK:   forth.push_value %{{.*}}, %{{.*}} : !forth.stack, i64 -> !forth.stack
+\ CHECK:   forth.addi
+\ CHECK:   return
+
+\ CHECK: func.func private @SWAP2(%arg0: !forth.stack) -> !forth.stack {
+\ CHECK:   forth.pop %arg0 : !forth.stack -> !forth.stack, i64
+\ CHECK:   forth.pop %{{.*}} : !forth.stack -> !forth.stack, i64
+\ CHECK:   forth.push_value %{{.*}}, %{{.*}} : !forth.stack, i64 -> !forth.stack
+\ CHECK:   forth.push_value %{{.*}}, %{{.*}} : !forth.stack, i64 -> !forth.stack
+\ CHECK:   return
+
+\! kernel main
+: ADD3 { a b c -- } a b + c + ;
+: SWAP2 { x y -- } y x ;
+1 2 3 ADD3
+10 20 SWAP2