diff --git a/pyproject.toml b/pyproject.toml
index 28f53260..4cfbcc49 100644
--- a/pyproject.toml
+++ b/pyproject.toml
@@ -20,7 +20,9 @@ lint.ignore = [
     "D417", # argument description in docstring (unreliable)
     "ISC001", # simplify implicit str concatenation (ruff-format recommended)
 ]
-lint.per-file-ignores = {"*tests*" = [
+lint.per-file-ignores = {"*docs/conf.py" = [
+    "INP001",
+], "*tests*" = [
     "INP001",
     "S101",
 ], "hooks*" = [
diff --git a/tests/test_package_gen.py b/tests/test_package_gen.py
index f0862345..a975d0c0 100644
--- a/tests/test_package_gen.py
+++ b/tests/test_package_gen.py
@@ -56,6 +56,8 @@ def test_package_generation(
         "tests",
         pathlib.Path(".github"),
         pathlib.Path(".github") / "workflows",
+        pathlib.Path("docs") / "conf.py",
+        pathlib.Path("docs") / "index.md",
     ]
     for f in expected_files:
         full_path = test_project_dir / f
diff --git a/{{cookiecutter.project_slug}}/.github/workflows/docs.yml b/{{cookiecutter.project_slug}}/.github/workflows/docs.yml
new file mode 100644
index 00000000..73adaede
--- /dev/null
+++ b/{{cookiecutter.project_slug}}/.github/workflows/docs.yml
@@ -0,0 +1,42 @@
+name: Documentation
+
+on:
+  push:
+    branches:
+      - main
+  pull_request:
+
+jobs:
+  build:
+    runs-on: ubuntu-latest
+    steps:
+      - name: Checkout source
+        uses: actions/checkout@v4
+      - name: Cache tox
+        uses: actions/cache@v4
+        with:
+          path: .tox
+          key: tox-${{ '{{' }} hashFiles('pyproject.toml') {{ '}}' }}
+      - name: Set up Python
+        uses: actions/setup-python@v4
+        with:
+          python-version: "3.x"
+          cache: "pip"
+          cache-dependency-path: "pyproject.toml"
+      - name: Install tox
+        run: python -m pip install tox
+      - name: Build HTML documentation with tox
+        run: tox -e docs
+    # Uncomment lines below to set-up automatic deployment of documentation to a
+    # GitHub Pages website on pushing to main - you will need configure the repository
+    # to deploy from a branch gh-pages (https://tinyurl.com/gh-pages-from-branch),
+    # which will be created the first time this workflow step is run
+    #   - name: Publish documentation on GitHub pages
+    #     if: success() && github.event_name != 'pull_request'
+    #     uses: peaceiris/actions-gh-pages@v3
+    #     with:
+    #       github_token: ${{ '{{' }}  secrets.GITHUB_TOKEN {{ '}}' }}
+    #       publish_dir: docs/_build/html
+    #       publish_branch: gh-pages
+    #       user_name: "github-actions[bot]"
+    #       user_email: "github-actions[bot]@users.noreply.github.com"
diff --git a/{{cookiecutter.project_slug}}/.gitignore b/{{cookiecutter.project_slug}}/.gitignore
index 6a566013..f6950181 100644
--- a/{{cookiecutter.project_slug}}/.gitignore
+++ b/{{cookiecutter.project_slug}}/.gitignore
@@ -71,6 +71,9 @@ instance/
 # Sphinx documentation
 docs/_build/
 
+# sphinx-autodoc2 generated API documentation
+docs/apidocs/
+
 # PyBuilder
 .pybuilder/
 target/
diff --git a/{{cookiecutter.project_slug}}/README.md b/{{cookiecutter.project_slug}}/README.md
index 847480f7..775d7c9b 100644
--- a/{{cookiecutter.project_slug}}/README.md
+++ b/{{cookiecutter.project_slug}}/README.md
@@ -3,6 +3,7 @@
 [![pre-commit](https://img.shields.io/badge/pre--commit-enabled-brightgreen?logo=pre-commit&logoColor=white)](https://github.com/pre-commit/pre-commit)
 [![Tests status][tests-badge]][tests-link]
 [![Linting status][linting-badge]][linting-link]
+[![Documentation status][documentation-badge]][linting-link]
 [![License][license-badge]](./LICENSE.md)
 
 <!--
@@ -16,6 +17,8 @@
 [tests-link]:               https://github.com/{{cookiecutter.github_username}}/{{cookiecutter.project_slug}}/actions/workflows/tests.yml
 [linting-badge]:            https://github.com/{{cookiecutter.github_username}}/{{cookiecutter.project_slug}}/actions/workflows/linting.yml/badge.svg
 [linting-link]:             https://github.com/{{cookiecutter.github_username}}/{{cookiecutter.project_slug}}/actions/workflows/linting.yml
+[documentation-badge]:      https://github.com/{{cookiecutter.github_username}}/{{cookiecutter.project_slug}}/actions/workflows/docs.yml/badge.svg
+[documentation-link]:       https://github.com/{{cookiecutter.github_username}}/{{cookiecutter.project_slug}}/actions/workflows/docs.yml
 [conda-badge]:              https://img.shields.io/conda/vn/conda-forge/{{cookiecutter.project_slug}}
 [conda-link]:               https://github.com/conda-forge/{{cookiecutter.project_slug}}-feedstock
 [pypi-link]:                https://pypi.org/project/{{cookiecutter.project_slug}}/
@@ -108,6 +111,17 @@ pytest tests
 
 again from the root of the repository.
 
+### Building documenttion
+
+The Sphinx HTML documentation can be built locally by running
+
+```sh
+tox -e docs
+```
+
+from the root of the repository.
+The built documentation will be written to `docs/_build/html`.
+
 ## Roadmap
 
 - [x] Initial Research
diff --git a/{{cookiecutter.project_slug}}/docs/conf.py b/{{cookiecutter.project_slug}}/docs/conf.py
new file mode 100644
index 00000000..2b33824b
--- /dev/null
+++ b/{{cookiecutter.project_slug}}/docs/conf.py
@@ -0,0 +1,53 @@
+"""Configuration file for the Sphinx documentation builder."""
+
+import datetime
+from importlib.metadata import version as get_version
+
+# For the full list of built-in configuration values, see the documentation:
+# https://www.sphinx-doc.org/en/master/usage/configuration.html
+
+# -- Project information -----------------------------------------------------
+# https://www.sphinx-doc.org/en/master/usage/configuration.html#project-information
+
+project = "{{cookiecutter.package_name}}"
+author = "{{cookiecutter.author_given_names}} {{cookiecutter.author_family_names}}"
+copyright = f"{datetime.datetime.now(tz=datetime.timezone.utc).year}, {author}"  # noqa: A001
+release = get_version("{{cookiecutter.package_name}}")
+version = ".".join(release.split(".")[:2])
+
+# -- General configuration ---------------------------------------------------
+# https://www.sphinx-doc.org/en/master/usage/configuration.html#general-configuration
+
+extensions = [
+    "autodoc2",
+    "myst_parser",
+    "sphinx.ext.viewcode",
+    "sphinx.ext.intersphinx",
+]
+
+intersphinx_mapping = {
+    "python": ("https://docs.python.org/3/", None),
+}
+
+exclude_patterns = ["_build"]
+
+autodoc2_packages = ["../src/{{cookiecutter.package_name}}"]
+autodoc2_render_plugin = "myst"
+
+myst_enable_extensions = ["fieldlist"]
+
+# -- Options for HTML output -------------------------------------------------
+# https://www.sphinx-doc.org/en/master/usage/configuration.html#options-for-html-output
+
+html_theme = "pydata_sphinx_theme"
+
+html_theme_options = {
+    "icon_links": [
+        {
+            "name": "GitHub",
+            "url": "https://github.com/{{cookiecutter.github_username}}/{{cookiecutter.project_slug}}/",
+            "icon": "fa-brands fa-github",
+            "type": "fontawesome",
+        },
+    ],
+}
diff --git a/{{cookiecutter.project_slug}}/docs/index.md b/{{cookiecutter.project_slug}}/docs/index.md
new file mode 100644
index 00000000..0ac6054c
--- /dev/null
+++ b/{{cookiecutter.project_slug}}/docs/index.md
@@ -0,0 +1,10 @@
+# {{cookiecutter.project_name}}
+
+{{cookiecutter.project_short_description}}
+
+```{toctree}
+---
+maxdepth: 2
+---
+apidocs/index
+```
diff --git a/{{cookiecutter.project_slug}}/pyproject.toml b/{{cookiecutter.project_slug}}/pyproject.toml
index ce13c8ff..da374cdf 100644
--- a/{{cookiecutter.project_slug}}/pyproject.toml
+++ b/{{cookiecutter.project_slug}}/pyproject.toml
@@ -33,8 +33,12 @@ name = "{{cookiecutter.project_slug}}"
 optional-dependencies = {dev = [
     "build",
     "mypy",
+    "myst-parser",
     "pre-commit",
+    "pydata-sphinx-theme",
     "ruff",
+    "sphinx",
+    "sphinx-autodoc2",
     "tox",
     "twine",
 ], test = [
@@ -80,7 +84,9 @@ lint.ignore = [
     "D417", # argument description in docstring (unreliable)
     "ISC001", # simplify implicit str concatenation (ruff-format recommended)
 ]
-lint.per-file-ignores = {"tests*" = [
+lint.per-file-ignores = {"docs/conf.py" = [
+    "INP001",
+], "tests*" = [
     "INP001",
     "S101",
 ]}
@@ -131,4 +137,13 @@ legacy_tox_ini = """
     ) %}
         py3{{python_version}}
     {%- endfor %}
+
+    [testenv:docs]
+    commands =
+        sphinx-build -W -b html docs docs/_build/html
+    deps =
+        myst-parser
+        pydata-sphinx-theme
+        sphinx
+        sphinx-autodoc2
 """
diff --git a/{{cookiecutter.project_slug}}/src/{{cookiecutter.package_name}}/__init__.py b/{{cookiecutter.project_slug}}/src/{{cookiecutter.package_name}}/__init__.py
index e6dfdbd4..8184c4f2 100644
--- a/{{cookiecutter.project_slug}}/src/{{cookiecutter.package_name}}/__init__.py
+++ b/{{cookiecutter.project_slug}}/src/{{cookiecutter.package_name}}/__init__.py
@@ -1,2 +1,13 @@
 """{{cookiecutter.package_name}} package."""
 from ._version import __version__  # noqa: F401
+
+
+def example_function(argument: str, keyword_argument: str = "default") -> str:
+    """
+    Concatenate string arguments - an example function docstring.
+
+    :param argument: An argument.
+    :param keyword_argument: A keyword argument with a default value.
+    :returns: The concatenation of `argument` and `keyword_argument`.
+    """
+    return argument + keyword_argument