diff --git a/deployments/docker-compose.dev.yml b/deployments/docker-compose.dev.yml
index 9310820..213b8b9 100644
--- a/deployments/docker-compose.dev.yml
+++ b/deployments/docker-compose.dev.yml
@@ -11,8 +11,8 @@ services:
       - "8443:443"
     volumes:
       - ${FETCHML_REPO_ROOT:-..}/deployments/Caddyfile.dev:/etc/caddy/Caddyfile:ro
-      - ${FETCHML_REPO_ROOT:-..}/data/dev/caddy/data:/data
-      - ${FETCHML_REPO_ROOT:-..}/data/dev/caddy/config:/config
+      - ${SMOKE_TEST_DATA_DIR:-${FETCHML_REPO_ROOT:-..}/data/dev}/caddy/data:/data
+      - ${SMOKE_TEST_DATA_DIR:-${FETCHML_REPO_ROOT:-..}/data/dev}/caddy/config:/config
     depends_on:
       api-server:
         condition: service_healthy
@@ -42,10 +42,10 @@ services:
     expose:
       - "9101" # API and health endpoints (internal; external access via Caddy)
     volumes:
-      - ${FETCHML_REPO_ROOT:-..}/data/dev/logs:/logs
-      - ${FETCHML_REPO_ROOT:-..}/data/dev/experiments:/data/experiments
-      - ${FETCHML_REPO_ROOT:-..}/data/dev/active:/data/active
-      - ${FETCHML_REPO_ROOT:-..}/data/dev/workspaces:/data/active/workspaces:delegated
+      - ${SMOKE_TEST_DATA_DIR:-${FETCHML_REPO_ROOT:-..}/data/dev}/logs:/logs
+      - ${SMOKE_TEST_DATA_DIR:-${FETCHML_REPO_ROOT:-..}/data/dev}/experiments:/data/experiments
+      - ${SMOKE_TEST_DATA_DIR:-${FETCHML_REPO_ROOT:-..}/data/dev}/active:/data/active
+      - ${SMOKE_TEST_DATA_DIR:-${FETCHML_REPO_ROOT:-..}/data/dev}/workspaces:/data/active/workspaces:delegated
       - ${FETCHML_REPO_ROOT:-..}/configs/api/dev.yaml:/app/configs/api/dev.yaml
       - ${FETCHML_REPO_ROOT:-..}/ssl:/app/ssl
     depends_on:
@@ -71,7 +71,7 @@ services:
       - "9000:9000"
       - "9001:9001"
     volumes:
-      - ${FETCHML_REPO_ROOT:-..}/data/dev/minio:/data
+      - ${SMOKE_TEST_DATA_DIR:-${FETCHML_REPO_ROOT:-..}/data/dev}/minio:/data
     environment:
       - MINIO_ROOT_USER=minioadmin
       - MINIO_ROOT_PASSWORD=minioadmin123
@@ -133,10 +133,10 @@ services:
     ports:
       - "8888:8888"
     volumes:
-      - ${FETCHML_REPO_ROOT:-..}/data/dev/logs:/logs
-      - ${FETCHML_REPO_ROOT:-..}/data/dev/active:/data/active
-      - ${FETCHML_REPO_ROOT:-..}/data/dev/experiments:/data/experiments
-      - ${FETCHML_REPO_ROOT:-..}/data/dev/workspaces:/data/active/workspaces:delegated
+      - ${SMOKE_TEST_DATA_DIR:-${FETCHML_REPO_ROOT:-..}/data/dev}/logs:/logs
+      - ${SMOKE_TEST_DATA_DIR:-${FETCHML_REPO_ROOT:-..}/data/dev}/active:/data/active
+      - ${SMOKE_TEST_DATA_DIR:-${FETCHML_REPO_ROOT:-..}/data/dev}/experiments:/data/experiments
+      - ${SMOKE_TEST_DATA_DIR:-${FETCHML_REPO_ROOT:-..}/data/dev}/workspaces:/data/active/workspaces:delegated
       - ${FETCHML_REPO_ROOT:-..}/configs/workers/docker-dev.yaml:/app/configs/worker.yaml
       - /sys/fs/cgroup:/sys/fs/cgroup:rw
     depends_on:
@@ -210,7 +210,7 @@ services:
     container_name: ml-experiments-promtail
     volumes:
       - ${FETCHML_REPO_ROOT:-..}/monitoring/promtail-config.yml:/etc/promtail/config.yml
-      - ${FETCHML_REPO_ROOT:-..}/data/dev/logs:/var/log/app
+      - ${SMOKE_TEST_DATA_DIR:-${FETCHML_REPO_ROOT:-..}/data/dev}/logs:/var/log/app
       - /var/lib/docker/containers:/var/lib/docker/containers:ro
       - /var/run/docker.sock:/var/run/docker.sock
     command: -config.file=/etc/promtail/config.yml
diff --git a/scripts/dev/smoke-test.sh b/scripts/dev/smoke-test.sh
index 9c4ef83..e81e1b8 100644
--- a/scripts/dev/smoke-test.sh
+++ b/scripts/dev/smoke-test.sh
@@ -104,42 +104,26 @@ api_wait_seconds=90
 prometheus_wait_seconds=90
 
 if [ "$env" = "dev" ]; then
+    # Use temp directory for smoke test data to avoid file sharing issues on macOS/Colima
+    SMOKE_TEST_DATA_DIR="${SMOKE_TEST_DATA_DIR:-$(mktemp -d /tmp/fetch_ml_smoke.XXXXXX)}"
+    echo "Using temp directory: $SMOKE_TEST_DATA_DIR"
+    
     mkdir -p \
-        "$repo_root/data/dev/redis" \
-        "$repo_root/data/dev/minio" \
-        "$repo_root/data/dev/prometheus" \
-        "$repo_root/data/dev/grafana" \
-        "$repo_root/data/dev/loki" \
-        "$repo_root/data/dev/logs" \
-        "$repo_root/data/dev/experiments" \
-        "$repo_root/data/dev/active" \
-        "$repo_root/data/dev/workspaces"
+        "$SMOKE_TEST_DATA_DIR/redis" \
+        "$SMOKE_TEST_DATA_DIR/minio" \
+        "$SMOKE_TEST_DATA_DIR/prometheus" \
+        "$SMOKE_TEST_DATA_DIR/grafana" \
+        "$SMOKE_TEST_DATA_DIR/loki" \
+        "$SMOKE_TEST_DATA_DIR/logs" \
+        "$SMOKE_TEST_DATA_DIR/experiments" \
+        "$SMOKE_TEST_DATA_DIR/active" \
+        "$SMOKE_TEST_DATA_DIR/workspaces"
 
-    # Verify Docker can access the data directory (macOS file sharing check)
-    if ! docker run --rm -v "$repo_root/data/dev:/test-data:ro" alpine:3.19 ls /test-data >/dev/null 2>&1; then
-        echo "ERROR: Docker cannot access $repo_root/data/dev"
-        echo ""
-        if command -v colima >/dev/null 2>&1; then
-            echo "You are using Colima. To fix:"
-            echo "1. Stop Colima: colima stop"
-            echo "2. Start with host mounts enabled: colima start --mount-type=virtiofs"
-            echo "   OR: colima start --mount-type=sshfs --mount-writable"
-            echo "3. Verify the mount: colima ssh -- ls $repo_root/data/dev"
-            echo ""
-            echo "If using Colima template, ensure your ~/.colima/default/colima.yaml has:"
-            echo "  mounts:"
-            echo "    - location: $repo_root"
-            echo "      writable: true"
-        else
-            echo "This is a Docker Desktop file sharing issue. To fix:"
-            echo "1. Open Docker Desktop -> Settings -> Resources -> File sharing"
-            echo "2. Add or verify: $repo_root"
-            echo "3. Click 'Apply & Restart'"
-        fi
-        echo ""
-        echo "Alternatively, run: mkdir -p $repo_root/data/dev/{redis,minio,prometheus,grafana,loki,logs,experiments,active,workspaces}"
-        exit 1
-    fi
+    # Export for docker-compose to use
+    export SMOKE_TEST_DATA_DIR
+    
+    # Update compose project args to include env file with the data dir
+    compose_project_args=("--project-directory" "$repo_root" "--env-file" <(echo "SMOKE_TEST_DATA_DIR=$SMOKE_TEST_DATA_DIR"))
 
     stack_name="dev"
     api_wait_seconds=180
@@ -151,13 +135,23 @@ if [ "$env" = "dev" ]; then
     fi
     prometheus_base="http://localhost:9090"
 else
+    # Use temp directory for prod smoke test too
+    SMOKE_TEST_DATA_DIR="${SMOKE_TEST_DATA_DIR:-$(mktemp -d /tmp/fetch_ml_smoke_prod.XXXXXX)}"
+    echo "Using temp directory: $SMOKE_TEST_DATA_DIR"
+    
     mkdir -p \
-        "$repo_root/data/prod-smoke/caddy/data" \
-        "$repo_root/data/prod-smoke/caddy/config" \
-        "$repo_root/data/prod-smoke/redis" \
-        "$repo_root/data/prod-smoke/logs" \
-        "$repo_root/data/prod-smoke/experiments" \
-        "$repo_root/data/prod-smoke/active"
+        "$SMOKE_TEST_DATA_DIR/caddy/data" \
+        "$SMOKE_TEST_DATA_DIR/caddy/config" \
+        "$SMOKE_TEST_DATA_DIR/redis" \
+        "$SMOKE_TEST_DATA_DIR/logs" \
+        "$SMOKE_TEST_DATA_DIR/experiments" \
+        "$SMOKE_TEST_DATA_DIR/active"
+
+    # Export for docker-compose to use
+    export SMOKE_TEST_DATA_DIR
+    
+    # Update compose project args to include env file with the data dir
+    compose_project_args=("--project-directory" "$repo_root" "--env-file" <(echo "SMOKE_TEST_DATA_DIR=$SMOKE_TEST_DATA_DIR"))
 
     stack_name="prod"
     compose_files=("-f" "$repo_root/deployments/docker-compose.prod.smoke.yml")