diff --git a/backend/src/config/prisma.ts b/backend/src/config/prisma.ts
new file mode 100644
index 0000000..d8da635
--- /dev/null
+++ b/backend/src/config/prisma.ts
@@ -0,0 +1,82 @@
+/**
+ * Prisma Client Singleton
+ *
+ * This module ensures only one instance of PrismaClient is created
+ * and reused across the application, preventing connection pool exhaustion.
+ *
+ * @see https://www.prisma.io/docs/guides/performance-and-optimization/connection-management
+ */
+
+import { PrismaClient } from '@prisma/client';
+import { logger } from './logger';
+
+// PrismaClient is attached to the global object in development
+// to prevent hot-reloading from creating new instances
+const globalForPrisma = global as unknown as { prisma: PrismaClient };
+
+/**
+ * Create PrismaClient with logging configuration
+ */
+const createPrismaClient = (): PrismaClient => {
+  const client = new PrismaClient({
+    log: [
+      {
+        emit: 'event',
+        level: 'query',
+      },
+      {
+        emit: 'event',
+        level: 'error',
+      },
+      {
+        emit: 'event',
+        level: 'warn',
+      },
+    ],
+  });
+
+  // Hook into Prisma query logging
+  client.$on('query' as never, ((event: any) => {
+    logger.debug('Prisma Query:', {
+      query: event.query,
+      params: event.params,
+      duration: `${event.duration}ms`,
+    });
+  }) as never);
+
+  client.$on('error' as never, ((event: any) => {
+    logger.error('Prisma Error:', event);
+  }) as never);
+
+  client.$on('warn' as never, ((event: any) => {
+    logger.warn('Prisma Warning:', event);
+  }) as never);
+
+  return client;
+};
+
+/**
+ * Singleton PrismaClient instance
+ * In development, the instance is cached on the global object
+ * to survive hot-reloads
+ */
+export const prisma = globalForPrisma.prisma || createPrismaClient();
+
+if (process.env.NODE_ENV !== 'production') {
+  globalForPrisma.prisma = prisma;
+}
+
+/**
+ * Graceful disconnect on process termination
+ */
+const gracefulShutdown = async () => {
+  logger.info('Disconnecting Prisma Client...');
+  await prisma.$disconnect();
+  logger.info('Prisma Client disconnected');
+};
+
+process.on('beforeExit', gracefulShutdown);
+process.on('SIGINT', gracefulShutdown);
+process.on('SIGTERM', gracefulShutdown);
+
+export default prisma;
diff --git a/backend/src/controllers/authController.ts b/backend/src/controllers/authController.ts
index 1c49445..79d45a4 100644
--- a/backend/src/controllers/authController.ts
+++ b/backend/src/controllers/authController.ts
@@ -1,6 +1,5 @@
 import { Request, Response } from 'express';
 import bcrypt from 'bcryptjs';
-import { PrismaClient } from '@prisma/client';
 import {
   generateAccessToken,
   generateRefreshToken,
@@ -10,8 +9,7 @@ import { AppError, asyncHandler } from '../middleware/errorHandler';
 import { logger } from '../config/logger';
 import { config } from '../config/environment';
 import { AuthenticatedRequest } from '../types';
-
-const prisma = new PrismaClient();
+import { prisma } from '../config/prisma';
 
 /**
  * @desc    Register a new user
diff --git a/backend/src/controllers/notificationController.ts b/backend/src/controllers/notificationController.ts
index 64237a2..4db81ae 100644
--- a/backend/src/controllers/notificationController.ts
+++ b/backend/src/controllers/notificationController.ts
@@ -1,10 +1,8 @@
 import { Request, Response } from 'express';
-import { PrismaClient } from '@prisma/client';
 import { AppError, asyncHandler } from '../middleware/errorHandler';
 import { logger } from '../config/logger';
 import { AuthenticatedRequest } from '../types';
-
-const prisma = new PrismaClient();
+import { prisma } from '../config/prisma';
 
 /**
  * @desc    Get user notifications
diff --git a/backend/src/controllers/projectController.ts b/backend/src/controllers/projectController.ts
index 5955225..c3e882f 100644
--- a/backend/src/controllers/projectController.ts
+++ b/backend/src/controllers/projectController.ts
@@ -1,10 +1,8 @@
 import { Request, Response } from 'express';
-import { PrismaClient } from '@prisma/client';
 import { AppError, asyncHandler } from '../middleware/errorHandler';
 import { logger } from '../config/logger';
 import { AuthenticatedRequest } from '../types';
-
-const prisma = new PrismaClient();
+import { prisma } from '../config/prisma';
 
 /**
  * Check if user has access to project
diff --git a/backend/src/controllers/taskController.ts b/backend/src/controllers/taskController.ts
index 0e3b9e6..fbba7c2 100644
--- a/backend/src/controllers/taskController.ts
+++ b/backend/src/controllers/taskController.ts
@@ -1,10 +1,8 @@
 import { Request, Response } from 'express';
-import { PrismaClient } from '@prisma/client';
 import { AppError, asyncHandler } from '../middleware/errorHandler';
 import { logger } from '../config/logger';
 import { AuthenticatedRequest } from '../types';
-
-const prisma = new PrismaClient();
+import { prisma } from '../config/prisma';
 
 /**
  * Check if user has access to task
diff --git a/backend/src/controllers/userController.ts b/backend/src/controllers/userController.ts
index 2b476f1..75e1213 100644
--- a/backend/src/controllers/userController.ts
+++ b/backend/src/controllers/userController.ts
@@ -1,12 +1,10 @@
 import { Request, Response } from 'express';
 import bcrypt from 'bcryptjs';
-import { PrismaClient } from '@prisma/client';
 import { AppError, asyncHandler } from '../middleware/errorHandler';
 import { logger } from '../config/logger';
 import { config } from '../config/environment';
 import { AuthenticatedRequest } from '../types';
-
-const prisma = new PrismaClient();
+import { prisma } from '../config/prisma';
 
 /**
  * @desc    Get current user profile
diff --git a/backend/src/middleware/auth.ts b/backend/src/middleware/auth.ts
index 2e39684..d62d7e3 100644
--- a/backend/src/middleware/auth.ts
+++ b/backend/src/middleware/auth.ts
@@ -1,11 +1,9 @@
 import { Request, Response, NextFunction } from 'express';
 import jwt from 'jsonwebtoken';
-import { PrismaClient } from '@prisma/client';
 import { config, jwtConfig } from '../config/environment';
 import { logger } from '../config/logger';
 import { AuthenticatedRequest, JWTPayload } from '../types';
-
-const prisma = new PrismaClient();
+import { prisma } from '../config/prisma';
 
 /**
  * JWT Authentication Middleware
diff --git a/backend/src/server.ts b/backend/src/server.ts
index 447eea2..a5c9139 100644
--- a/backend/src/server.ts
+++ b/backend/src/server.ts
@@ -102,13 +102,44 @@ app.use('/api/tasks', authMiddleware, taskRoutes);
 app.use('/api/notifications', authMiddleware, notificationRoutes);
 
 // Socket.IO for real-time features
-io.use((socket, next) => {
-  const token = socket.handshake.auth.token;
-  if (!token) {
+io.use(async (socket, next) => {
+  try {
+    const token = socket.handshake.auth.token;
+    if (!token) {
+      return next(new Error('Authentication error: Token required'));
+    }
+
+    // Validate JWT token
+    const jwt = await import('jsonwebtoken');
+    const { jwtConfig } = await import('./config/environment');
+    const { prisma } = await import('./config/prisma');
+
+    try {
+      const decoded = jwt.verify(token, jwtConfig.secret, {
+        issuer: jwtConfig.issuer,
+        audience: jwtConfig.audience,
+      }) as any;
+
+      // Verify user exists and is active
+      const user = await prisma.user.findUnique({
+        where: { id: decoded.userId },
+        select: { id: true, email: true, isActive: true },
+      });
+
+      if (!user || !user.isActive) {
+        return next(new Error('Authentication error: Invalid user'));
+      }
+
+      // Attach user to socket
+      socket.data.user = user;
+      next();
+    } catch (error) {
+      return next(new Error('Authentication error: Invalid token'));
+    }
+  } catch (error) {
+    logger.error('Socket.IO auth error:', error);
     return next(new Error('Authentication error'));
   }
-  // Add token validation here
-  next();
 });
 
 io.on('connection', (socket) => {