diff --git a/README.md b/README.md
index 2e6bbf1..2fa3ca1 100644
--- a/README.md
+++ b/README.md
@@ -42,6 +42,23 @@ The user-facing part of the application allows users to browse and book tickets.
 
 ## Setup and Installation
 
+To configure the database and email settings, create a `.env` file in the `server` directory with the following variables:
+
+```
+DB_HOST=your_database_host
+DB_USER=your_database_user
+DB_PASSWORD=your_database_password
+DB_NAME=your_database_name
+
+EMAIL_HOST=your_email_server_host
+EMAIL_PORT=your_email_server_port
+EMAIL_USER=your_email_address
+EMAIL_PASS=your_email_password
+EMAIL_FROM=your_sending_email_address
+```
+
+Replace the placeholder values with your actual database and email server credentials.
+
 *(Instructions on how to set up and run the project - placeholder for now)*
 
 ## Usage