diff --git a/setup.sh b/setup.sh
index 8c07f7f..f21f73f 100755
--- a/setup.sh
+++ b/setup.sh
@@ -59,17 +59,32 @@ check_docker() {
 install_dependencies() {
     print_status "Installing Python dependencies..."
     
+    # Detect Python environment
+    PYTHON_CMD="python3"
+    PIP_CMD="pip3"
+    
+    # Check if we're in a virtual environment
+    if [[ -n "$VIRTUAL_ENV" ]]; then
+        print_status "Detected virtual environment: $VIRTUAL_ENV"
+        PIP_CMD="pip"
+    elif [[ -f "venv/bin/activate" ]]; then
+        print_status "Detected local virtual environment"
+        source venv/bin/activate
+        PIP_CMD="pip"
+    fi
+    
     # Check if pip is available
-    if ! command -v pip3 &> /dev/null; then
-        print_error "pip3 is not installed. Please install pip3 first"
+    if ! command -v $PIP_CMD &> /dev/null; then
+        print_error "pip is not available. Please install pip first"
         exit 1
     fi
     
-    # Install requirements
+    # Install requirements with appropriate flags
     if [[ -f "requirements.txt" ]]; then
-        pip3 install -r requirements.txt
+        $PIP_CMD install -r requirements.txt --break-system-packages || $PIP_CMD install -r requirements.txt
     else
-        pip3 install flask flask-cors docker requests python-dotenv
+        $PIP_CMD install flask flask-cors docker requests python-dotenv --break-system-packages || \
+        $PIP_CMD install flask flask-cors docker requests python-dotenv
     fi
     
     print_status "Dependencies installed successfully"
@@ -101,9 +116,20 @@ setup_environment() {
 initialize_database() {
     print_status "Initializing database..."
     
+    # Detect Python command
+    PYTHON_CMD="python3"
+    if [[ -n "$VIRTUAL_ENV" ]] || [[ -f "venv/bin/activate" ]]; then
+        if [[ -f "venv/bin/activate" ]]; then
+            source venv/bin/activate
+            PYTHON_CMD="python"
+        else
+            PYTHON_CMD="python"
+        fi
+    fi
+    
     # Create database if it doesn't exist
     if [[ ! -f "dashboard.db" ]]; then
-        python3 -c "
+        $PYTHON_CMD -c "
 import database
 db = database.DatabaseManager()
 db.init_db()
@@ -132,11 +158,22 @@ kill_existing_processes() {
 launch_application() {
     print_status "Launching Docker Dashboard..."
     
+    # Detect Python command
+    PYTHON_CMD="python3"
+    if [[ -n "$VIRTUAL_ENV" ]] || [[ -f "venv/bin/activate" ]]; then
+        if [[ -f "venv/bin/activate" ]]; then
+            source venv/bin/activate
+            PYTHON_CMD="python"
+        else
+            PYTHON_CMD="python"
+        fi
+    fi
+    
     # Create logs directory
     mkdir -p logs
     
     # Launch the application in background
-    nohup python3 api.py > logs/dashboard.log 2>&1 &
+    nohup $PYTHON_CMD api.py > logs/dashboard.log 2>&1 &
     
     # Get the process ID
     APP_PID=$!