diff --git a/go.mod b/go.mod
index 104d979..6029104 100644
--- a/go.mod
+++ b/go.mod
@@ -1,3 +1,5 @@
 module notashelf.dev/watchdog
 
 go 1.25.5
+
+require gopkg.in/yaml.v3 v3.0.1
diff --git a/go.sum b/go.sum
new file mode 100644
index 0000000..a62c313
--- /dev/null
+++ b/go.sum
@@ -0,0 +1,4 @@
+gopkg.in/check.v1 v0.0.0-20161208181325-20d25e280405 h1:yhCVgyC4o1eVCa2tZl7eS0r+SDo693bJlVdllGtEeKM=
+gopkg.in/check.v1 v0.0.0-20161208181325-20d25e280405/go.mod h1:Co6ibVJAznAaIkqp8huTwlJQCZ016jof/cbN4VW5Yz0=
+gopkg.in/yaml.v3 v3.0.1 h1:fxVm/GzAzEWqLHuvctI91KS9hhNmmWOoWu0XTYJS7CA=
+gopkg.in/yaml.v3 v3.0.1/go.mod h1:K4uyk7z7BCEPqu6E+C64Yfv1cQ7kz7rIZviUmN+EgEM=
diff --git a/internal/config/config.go b/internal/config/config.go
new file mode 100644
index 0000000..9725105
--- /dev/null
+++ b/internal/config/config.go
@@ -0,0 +1,104 @@
+package config
+
+import (
+	"fmt"
+	"os"
+
+	"gopkg.in/yaml.v3"
+)
+
+// Configuration structure
+type Config struct {
+	Site   SiteConfig   `yaml:"site"`
+	Limits LimitsConfig `yaml:"limits"`
+	Server ServerConfig `yaml:"server"`
+}
+
+// Site-specific settings
+type SiteConfig struct {
+	Domain       string        `yaml:"domain"`
+	SaltRotation string        `yaml:"salt_rotation"`
+	Collect      CollectConfig `yaml:"collect"`
+	CustomEvents []string      `yaml:"custom_events"`
+	Path         PathConfig    `yaml:"path"`
+}
+
+// Which dimensions to collect
+type CollectConfig struct {
+	Pageviews bool   `yaml:"pageviews"`
+	Country   bool   `yaml:"country"`
+	Device    bool   `yaml:"device"`
+	Referrer  string `yaml:"referrer"`
+}
+
+// Path normalization options
+type PathConfig struct {
+	StripQuery              bool `yaml:"strip_query"`
+	StripFragment           bool `yaml:"strip_fragment"`
+	CollapseNumericSegments bool `yaml:"collapse_numeric_segments"`
+	MaxSegments             int  `yaml:"max_segments"`
+}
+
+// Cardinality limits
+type LimitsConfig struct {
+	MaxPaths           int `yaml:"max_paths"`
+	MaxEventsPerMinute int `yaml:"max_events_per_minute"`
+}
+
+// Server endpoints
+type ServerConfig struct {
+	ListenAddr    string `yaml:"listen_addr"`
+	MetricsPath   string `yaml:"metrics_path"`
+	IngestionPath string `yaml:"ingestion_path"`
+}
+
+// YAML configuration file
+func Load(path string) (*Config, error) {
+	data, err := os.ReadFile(path)
+	if err != nil {
+		return nil, fmt.Errorf("failed to read config file: %w", err)
+	}
+
+	var cfg Config
+	if err := yaml.Unmarshal(data, &cfg); err != nil {
+		return nil, fmt.Errorf("failed to parse config: %w", err)
+	}
+
+	if err := cfg.Validate(); err != nil {
+		return nil, fmt.Errorf("config validation failed: %w", err)
+	}
+
+	return &cfg, nil
+}
+
+// Check required fields and sets defaults
+// FIXME: in the future we need to validate in the config parser
+func (c *Config) Validate() error {
+	// Validate site domain is required
+	if c.Site.Domain == "" {
+		return fmt.Errorf("site.domain is required")
+	}
+
+	// Validate salt_rotation if provided
+	if c.Site.SaltRotation != "" && c.Site.SaltRotation != "daily" && c.Site.SaltRotation != "hourly" {
+		return fmt.Errorf("site.salt_rotation must be 'daily' or 'hourly'")
+	}
+
+	// Validate max_paths is positive
+	if c.Limits.MaxPaths <= 0 {
+		return fmt.Errorf("limits.max_paths must be greater than 0")
+	}
+
+	// Set server defaults if not provided
+	if c.Server.ListenAddr == "" {
+		c.Server.ListenAddr = ":8080"
+	}
+	if c.Server.MetricsPath == "" {
+		c.Server.MetricsPath = "/metrics"
+	}
+	if c.Server.IngestionPath == "" {
+		c.Server.IngestionPath = "/api/event"
+	}
+
+	return nil
+}
diff --git a/internal/config/config_test.go b/internal/config/config_test.go
new file mode 100644
index 0000000..43651f9
--- /dev/null
+++ b/internal/config/config_test.go
@@ -0,0 +1,44 @@
+package config
+
+import (
+	"testing"
+)
+
+func TestLoadConfig_ValidFile(t *testing.T) {
+	cfg, err := Load("../../testdata/config.valid.yaml")
+	if err != nil {
+		t.Fatalf("expected no error, got %v", err)
+	}
+
+	if cfg.Site.Domain != "example.com" {
+		t.Errorf("expected domain 'example.com', got '%s'", cfg.Site.Domain)
+	}
+
+	if cfg.Site.SaltRotation != "daily" {
+		t.Errorf("expected salt_rotation 'daily', got '%s'", cfg.Site.SaltRotation)
+	}
+}
+
+func TestLoadConfig_MissingFile(t *testing.T) {
+	_, err := Load("nonexistent.yaml")
+	if err == nil {
+		t.Fatal("expected error for missing file, got nil")
+	}
+}
+
+func TestValidate_MaxPathsRequired(t *testing.T) {
+	cfg := &Config{
+		Site: SiteConfig{
+			Domain:       "example.com",
+			SaltRotation: "daily",
+		},
+		Limits: LimitsConfig{
+			MaxPaths: 0, // invalid
+		},
+	}
+
+	err := cfg.Validate()
+	if err == nil {
+		t.Fatal("expected validation error for max_paths=0, got nil")
+	}
+}
diff --git a/testdata/config.invalid.yaml b/testdata/config.invalid.yaml
new file mode 100644
index 0000000..066753f
--- /dev/null
+++ b/testdata/config.invalid.yaml
@@ -0,0 +1,6 @@
+site:
+  domain: ""
+  salt_rotation: daily
+
+limits:
+  max_paths: 0
diff --git a/testdata/config.valid.yaml b/testdata/config.valid.yaml
new file mode 100644
index 0000000..c723c6a
--- /dev/null
+++ b/testdata/config.valid.yaml
@@ -0,0 +1,25 @@
+site:
+  domain: example.com
+  salt_rotation: daily
+  collect:
+    pageviews: true
+    country: true
+    device: true
+    referrer: classify
+  custom_events:
+    - signup
+    - purchase
+  path:
+    strip_query: true
+    strip_fragment: true
+    collapse_numeric_segments: true
+    max_segments: 5
+
+limits:
+  max_paths: 1000
+  max_events_per_minute: 10000
+
+server:
+  listen_addr: :8080
+  metrics_path: /metrics
+  ingestion_path: /api/event