diff --git a/alembic.ini b/alembic.ini
new file mode 100644
index 0000000..5cda32e
--- /dev/null
+++ b/alembic.ini
@@ -0,0 +1,97 @@
+# A generic, single database configuration.
+
+[alembic]
+# path to migration scripts
+script_location = alembic
+
+# template used to generate migration file names; The default value is %%(rev)s_%%(slug)s
+# Uncomment the line below if you want the files to be prepended with date and time
+# file_template = %%(year)d_%%(month).2d_%%(day).2d_%%(hour).2d%%(minute).2d-%%(rev)s_%%(slug)s
+
+# sys.path path, will be prepended to sys.path if present.
+# defaults to the current working directory.
+prepend_sys_path = .
+
+# timezone to use when rendering the date within the migration file
+# as well as the filename.
+# If specified, requires the python-dateutil library that can be
+# installed by adding `alembic[tz]` to the pip requirements
+# string value is passed to dateutil.tz.gettz()
+# leave blank for localtime
+# timezone =
+
+# max length of characters to apply to the
+# "slug" field
+# truncate_slug_length = 40
+
+# set to 'true' to run the environment during
+# the 'revision' command, regardless of autogenerate
+# revision_environment = false
+
+# set to 'true' to allow .pyc and .pyo files without
+# a source .py file to be detected as revisions in the
+# versions/ directory
+# sourceless = false
+
+# version path separator; As mentioned above, this is the character used to split
+# version_locations. The default within new alembic.ini files is "os", which uses
+# os.pathsep. If this key is omitted entirely, it falls back to the legacy
+# behavior of splitting on spaces and/or commas.
+# Valid values for version_path_separator are:
+#
+# version_path_separator = :
+# version_path_separator = ;
+# version_path_separator = space
+version_path_separator = os
+
+# the output encoding used when revision files
+# are written from script.py.mako
+# output_encoding = utf-8
+
+sqlalchemy.url = sqlite:////app/storage/db/db.sqlite
+
+[post_write_hooks]
+# post_write_hooks defines scripts or Python functions that are run
+# on newly generated revision scripts.  See the documentation for further
+# detail and examples
+
+# format using "black" - use the console_scripts runner, against the "black" entrypoint
+# hooks = black
+# black.type = console_scripts
+# black.entrypoint = black
+# black.options = -l 79 REVISION_SCRIPT_FILENAME
+
+# Logging configuration
+[loggers]
+keys = root,sqlalchemy,alembic
+
+[handlers]
+keys = console
+
+[formatters]
+keys = generic
+
+[logger_root]
+level = WARN
+handlers = console
+qualname =
+
+[logger_sqlalchemy]
+level = WARN
+handlers =
+qualname = sqlalchemy.engine
+
+[logger_alembic]
+level = INFO
+handlers =
+qualname = alembic
+
+[handler_console]
+class = StreamHandler
+args = (sys.stderr,)
+level = NOTSET
+formatter = generic
+
+[formatter_generic]
+format = %(levelname)-5.5s [%(name)s] %(message)s
+datefmt = %H:%M:%S
\ No newline at end of file
diff --git a/app/api/__init__.py b/app/api/__init__.py
new file mode 100644
index 0000000..e69de29
diff --git a/app/api/endpoints/__init__.py b/app/api/endpoints/__init__.py
new file mode 100644
index 0000000..e69de29
diff --git a/app/api/v1/__init__.py b/app/api/v1/__init__.py
new file mode 100644
index 0000000..e69de29
diff --git a/app/api/v1/api.py b/app/api/v1/api.py
new file mode 100644
index 0000000..e9443c1
--- /dev/null
+++ b/app/api/v1/api.py
@@ -0,0 +1,12 @@
+from fastapi import APIRouter
+
+# Create the main API router
+api_router = APIRouter()
+
+# For now, just include a basic health endpoint under API
+@api_router.get("/health")
+async def api_health():
+    """
+    API health check endpoint.
+    """
+    return {"status": "healthy", "api_version": "v1"}
\ No newline at end of file
diff --git a/app/core/__init__.py b/app/core/__init__.py
new file mode 100644
index 0000000..e69de29
diff --git a/app/core/config.py b/app/core/config.py
new file mode 100644
index 0000000..80d34ec
--- /dev/null
+++ b/app/core/config.py
@@ -0,0 +1,18 @@
+from pydantic_settings import BaseSettings
+from pathlib import Path
+
+
+class Settings(BaseSettings):
+    PROJECT_NAME: str = "Todo API"
+    PROJECT_VERSION: str = "1.0.0"
+    
+    # Database settings
+    DB_DIR: Path = Path("/app/storage/db")
+    SQLALCHEMY_DATABASE_URL: str = f"sqlite:///{DB_DIR}/db.sqlite"
+    
+    class Config:
+        env_file = ".env"
+        case_sensitive = True
+
+
+settings = Settings()
\ No newline at end of file
diff --git a/app/crud/__init__.py b/app/crud/__init__.py
new file mode 100644
index 0000000..e69de29
diff --git a/app/crud/todo.py b/app/crud/todo.py
new file mode 100644
index 0000000..0cdb112
--- /dev/null
+++ b/app/crud/todo.py
@@ -0,0 +1,63 @@
+from sqlalchemy.orm import Session
+from app.models.todo import Todo
+from app.schemas.todo import TodoCreate, TodoUpdate
+from typing import List, Optional
+
+
+def get_todo(db: Session, todo_id: int) -> Optional[Todo]:
+    """
+    Get a single todo by ID.
+    """
+    return db.query(Todo).filter(Todo.id == todo_id).first()
+
+
+def get_todos(db: Session, skip: int = 0, limit: int = 100) -> List[Todo]:
+    """
+    Get all todos with pagination.
+    """
+    return db.query(Todo).offset(skip).limit(limit).all()
+
+
+def create_todo(db: Session, todo: TodoCreate) -> Todo:
+    """
+    Create a new todo.
+    """
+    db_todo = Todo(
+        title=todo.title,
+        description=todo.description,
+        completed=todo.completed
+    )
+    db.add(db_todo)
+    db.commit()
+    db.refresh(db_todo)
+    return db_todo
+
+
+def update_todo(db: Session, todo_id: int, todo_update: TodoUpdate) -> Optional[Todo]:
+    """
+    Update an existing todo.
+    """
+    db_todo = db.query(Todo).filter(Todo.id == todo_id).first()
+    if not db_todo:
+        return None
+    
+    update_data = todo_update.model_dump(exclude_unset=True)
+    for field, value in update_data.items():
+        setattr(db_todo, field, value)
+    
+    db.commit()
+    db.refresh(db_todo)
+    return db_todo
+
+
+def delete_todo(db: Session, todo_id: int) -> bool:
+    """
+    Delete a todo by ID.
+    """
+    db_todo = db.query(Todo).filter(Todo.id == todo_id).first()
+    if not db_todo:
+        return False
+    
+    db.delete(db_todo)
+    db.commit()
+    return True
\ No newline at end of file
diff --git a/app/db/base.py b/app/db/base.py
index 9d46b7b..3a34caa 100644
--- a/app/db/base.py
+++ b/app/db/base.py
@@ -1,19 +1,7 @@
-from sqlalchemy import create_engine
+"""
+Database base configuration.
+"""
 from sqlalchemy.ext.declarative import declarative_base
-from sqlalchemy.orm import sessionmaker
-from pathlib import Path
-
-# Database setup
-DB_DIR = Path("/app/storage/db")
-DB_DIR.mkdir(parents=True, exist_ok=True)
-
-SQLALCHEMY_DATABASE_URL = f"sqlite:///{DB_DIR}/db.sqlite"
-
-engine = create_engine(
-    SQLALCHEMY_DATABASE_URL,
-    connect_args={"check_same_thread": False}
-)
-
-SessionLocal = sessionmaker(autocommit=False, autoflush=False, bind=engine)
 
+# SQLAlchemy Base class for all models
 Base = declarative_base()
\ No newline at end of file
diff --git a/app/db/session.py b/app/db/session.py
index 5ac3870..4e7f755 100644
--- a/app/db/session.py
+++ b/app/db/session.py
@@ -1,13 +1,18 @@
-from sqlalchemy.orm import Session
-from app.db.base import SessionLocal
+from sqlalchemy import create_engine
+from sqlalchemy.orm import sessionmaker
+from pathlib import Path
 
+from app.core.config import settings
 
-def get_db() -> Session:
-    """
-    Dependency to get database session.
-    """
-    db = SessionLocal()
-    try:
-        yield db
-    finally:
-        db.close()
\ No newline at end of file
+# Create storage directory if it doesn't exist
+DB_DIR = Path("/app/storage/db")
+DB_DIR.mkdir(parents=True, exist_ok=True)
+
+SQLALCHEMY_DATABASE_URL = f"sqlite:///{DB_DIR}/db.sqlite"
+
+engine = create_engine(
+    SQLALCHEMY_DATABASE_URL,
+    connect_args={"check_same_thread": False}
+)
+
+SessionLocal = sessionmaker(autocommit=False, autoflush=False, bind=engine)
\ No newline at end of file
diff --git a/app/models/todo.py b/app/models/todo.py
index 2bb7ef1..66f2af0 100644
--- a/app/models/todo.py
+++ b/app/models/todo.py
@@ -1,15 +1,14 @@
-from datetime import datetime
-from sqlalchemy import Column, Integer, String, Text, Boolean, DateTime
-
+from sqlalchemy import Column, Integer, String, Boolean, DateTime
+from sqlalchemy.sql import func
 from app.db.base import Base
 
 
 class Todo(Base):
     __tablename__ = "todos"
-    
+
     id = Column(Integer, primary_key=True, index=True)
-    title = Column(String(255), nullable=False)
-    description = Column(Text, nullable=True)
+    title = Column(String(255), nullable=False, index=True)
+    description = Column(String(1000), nullable=True)
     completed = Column(Boolean, default=False, nullable=False)
-    created_at = Column(DateTime, default=datetime.utcnow, nullable=False)
-    updated_at = Column(DateTime, default=datetime.utcnow, onupdate=datetime.utcnow, nullable=False)
\ No newline at end of file
+    created_at = Column(DateTime(timezone=True), server_default=func.now())
+    updated_at = Column(DateTime(timezone=True), server_default=func.now(), onupdate=func.now())
\ No newline at end of file
diff --git a/app/schemas/__init__.py b/app/schemas/__init__.py
new file mode 100644
index 0000000..e69de29
diff --git a/app/schemas/todo.py b/app/schemas/todo.py
new file mode 100644
index 0000000..73d5f54
--- /dev/null
+++ b/app/schemas/todo.py
@@ -0,0 +1,28 @@
+from pydantic import BaseModel, Field
+from datetime import datetime
+from typing import Optional
+
+
+class TodoBase(BaseModel):
+    title: str = Field(..., min_length=1, max_length=255, description="Title of the todo item")
+    description: Optional[str] = Field(None, max_length=1000, description="Description of the todo item")
+    completed: bool = Field(False, description="Whether the todo item is completed")
+
+
+class TodoCreate(TodoBase):
+    pass
+
+
+class TodoUpdate(BaseModel):
+    title: Optional[str] = Field(None, min_length=1, max_length=255, description="Title of the todo item")
+    description: Optional[str] = Field(None, max_length=1000, description="Description of the todo item")
+    completed: Optional[bool] = Field(None, description="Whether the todo item is completed")
+
+
+class TodoResponse(TodoBase):
+    id: int
+    created_at: datetime
+    updated_at: datetime
+
+    class Config:
+        from_attributes = True
\ No newline at end of file