diff --git a/mentat/daemon.py b/mentat/daemon.py
new file mode 100644
index 000000000..c0f3fdbb3
--- /dev/null
+++ b/mentat/daemon.py
@@ -0,0 +1,158 @@
+import ast
+import re
+from pathlib import Path
+from textwrap import dedent
+from typing import List, Optional, Tuple
+
+import openai
+from watchfiles import Change, watch
+
+openai_client = openai.Client()
+
+
+def get_mentat_comment(filename: Path) -> Optional[Tuple[int, str]]:
+    with open(filename, "r") as file:
+        for line_number, line in enumerate(file, 1):
+            if line.startswith("# @mentat"):
+                comment_text = line.split("@mentat", 1)[1].strip()
+                return line_number, comment_text
+    return None
+
+
+prompt = """
+    You are an expert coding assistant. 
+
+    You will be given a code file and a coding task to complete. Your response will be inserted into 
+    the code file. Your response must be valid python code and must adhere strictly to the required 
+    format. Put all of your response that's valid python code between '@@start' and '@@end' lines.
+    Do not include any examples or instructions in your response. Do not re-write the entire file, 
+    just answer the coding task.
+
+    Example Request:
+
+    Code File:
+    ```
+    def add_numbers(a, b):
+        return a + b
+
+
+    def multiply_numbers(a, b):
+        return a * b
+
+
+    def subtract_numbers(a, b):
+        return a - b
+    ```
+
+    Code Task: create a new function that divides 2 numbers together.
+
+
+    Example Response:
+    
+    @@start
+    def divide_numbers(a, b):
+        return a / b
+    @@end
+"""
+
+
+def generate_code_lines(*, code_file: Path, code_task: str) -> List[str]:
+    user_prompt = f"""
+        Code File:
+        ```
+        {code_file.read_text()} 
+        ```
+
+        Code Task: {code_task}
+    """
+    user_prompt = dedent(user_prompt).strip()
+
+    # Call openai
+    chat = openai_client.chat.completions.create(
+        messages=[
+            {"role": "system", "content": dedent(prompt.strip())},
+            {"role": "user", "content": user_prompt},
+        ],
+        model="gpt-4-0125-preview",
+    )
+    result = chat.choices[0].message.content
+    if result is None:
+        return []
+
+    # Verify code is valid python (else re-run?)
+    pattern = r"@@start(.*?)@@end"
+    matches = re.findall(pattern, result, re.DOTALL)
+    if len(matches) == 0:
+        return []
+
+    match = matches[0]
+    try:
+        # Parse the code to verify its validity
+        ast.parse(match)
+    except SyntaxError:
+        return []
+
+    return match.splitlines()
+
+
+def modify_file_lines(*, path: Path, user_prompt: str, code_lines: List[str]):
+    with open(path, "r") as file:
+        file_lines = file.readlines()
+
+    # Find the line number the user_prompt is on
+    line_number = None
+    for _line_number, line in enumerate(file_lines, 1):
+        if line.strip() == f"# @mentat {user_prompt}":
+            line_number = _line_number
+    if line_number is None:
+        print("Could not find the line number for the user prompt")
+        return
+
+    # Modify the comment
+    file_lines.pop(line_number - 1)
+    file_lines.insert(line_number - 1, f"# [completed] @mentat {user_prompt}\n")
+
+    # Insert the code snippet into the file
+    code_line_number = line_number
+    for code_line in code_lines:
+        if code_line == "":
+            continue
+        file_lines.insert(code_line_number, f"{code_line}\n")
+        code_line_number += 1
+
+    with open(path, "w") as file:
+        file.writelines(file_lines)
+
+
+def process_file_change(path: Path):
+    # Get @mentat comment
+    comment = get_mentat_comment(path)
+    if comment is None:
+        return
+    comment_line, comment_text = comment
+    print(f"{path}:{comment_line} >> {comment_text}")
+
+    # Call openai
+    print("Calling openai...")
+    code_lines = generate_code_lines(code_file=path, code_task=comment_text)
+    if len(code_lines) == 0:
+        print("No code snippets generated")
+        return
+    else:
+        print("Code snippets generated:", "\n".join(code_lines))
+
+    # Modify the file
+    print("Modifying file...")
+    modify_file_lines(path=path, user_prompt=comment_text, code_lines=code_lines)
+    print("Done!")
+
+
+def main(path: Path = Path.cwd()):
+    print(f"Watching {path}")
+    for changes in watch(path, force_polling=True):
+        for change_type, _change_path in changes:
+            change_path = Path(_change_path)
+            if change_path.is_file() is False:
+                continue
+            if change_type == Change.modified:
+                process_file_change(change_path)
diff --git a/requirements.txt b/requirements.txt
index fb3fa217d..e76fdab7f 100644
--- a/requirements.txt
+++ b/requirements.txt
@@ -24,3 +24,4 @@ tiktoken==0.4.0
 typing_extensions==4.8.0
 tqdm==4.66.1
 webdriver_manager==4.0.1
+watchfiles==0.21.0
\ No newline at end of file
diff --git a/setup.py b/setup.py
index b903fe0ac..15da52fd1 100644
--- a/setup.py
+++ b/setup.py
@@ -27,6 +27,7 @@
     entry_points={
         "console_scripts": [
             "mentat=mentat.terminal.client:run_cli",
+            "mentat-daemon=mentat.daemon:main",
         ],
     },
     description="AI coding assistant on your command line",
@@ -40,6 +41,6 @@
             for r in pkg_resources.parse_requirements(
                 open(os.path.join(os.path.dirname(__file__), "dev-requirements.txt"))
             )
-        ]
+        ],
     },
 )