diff --git a/cognee/modules/data/processing/document_types/open_data_file.py b/cognee/modules/data/processing/document_types/open_data_file.py
index 207b67fdb..b86de3e91 100644
--- a/cognee/modules/data/processing/document_types/open_data_file.py
+++ b/cognee/modules/data/processing/document_types/open_data_file.py
@@ -22,5 +22,9 @@ def open_data_file(
             return f
         else:
             return fs.open(file_path, mode=mode, encoding=encoding, **kwargs)
+    elif file_path.startswith("file://"):
+        # Handle local file URLs by stripping the file:// prefix
+        file_path = file_path.replace("file://", "", 1)
+        return open(file_path, mode=mode, encoding=encoding, **kwargs)
     else:
         return open(file_path, mode=mode, encoding=encoding, **kwargs)
diff --git a/cognee/tests/unit/modules/data/test_open_data_file.py b/cognee/tests/unit/modules/data/test_open_data_file.py
new file mode 100644
index 000000000..5be04a1c3
--- /dev/null
+++ b/cognee/tests/unit/modules/data/test_open_data_file.py
@@ -0,0 +1,98 @@
+import os
+import tempfile
+import pytest
+from cognee.modules.data.processing.document_types.open_data_file import open_data_file
+
+
+class TestOpenDataFile:
+    """Test cases for open_data_file function with file:// URL handling."""
+
+    def test_regular_file_path(self):
+        """Test that regular file paths work as before."""
+        with tempfile.NamedTemporaryFile(mode='w', delete=False, suffix='.txt') as f:
+            test_content = "Test content for regular file path"
+            f.write(test_content)
+            temp_file_path = f.name
+        
+        try:
+            with open_data_file(temp_file_path, mode='r') as f:
+                content = f.read()
+                assert content == test_content
+        finally:
+            os.unlink(temp_file_path)
+
+    def test_file_url_text_mode(self):
+        """Test that file:// URLs work correctly in text mode."""
+        with tempfile.NamedTemporaryFile(mode='w', delete=False, suffix='.txt') as f:
+            test_content = "Test content for file:// URL handling"
+            f.write(test_content)
+            temp_file_path = f.name
+        
+        try:
+            file_url = f"file://{temp_file_path}"
+            with open_data_file(file_url, mode='r') as f:
+                content = f.read()
+                assert content == test_content
+        finally:
+            os.unlink(temp_file_path)
+
+    def test_file_url_binary_mode(self):
+        """Test that file:// URLs work correctly in binary mode."""
+        with tempfile.NamedTemporaryFile(mode='w', delete=False, suffix='.txt') as f:
+            test_content = "Test content for binary mode"
+            f.write(test_content)
+            temp_file_path = f.name
+        
+        try:
+            file_url = f"file://{temp_file_path}"
+            with open_data_file(file_url, mode='rb') as f:
+                content = f.read()
+                assert content == test_content.encode()
+        finally:
+            os.unlink(temp_file_path)
+
+    def test_file_url_with_encoding(self):
+        """Test that file:// URLs work with specific encoding."""
+        with tempfile.NamedTemporaryFile(mode='w', delete=False, suffix='.txt', encoding='utf-8') as f:
+            test_content = "Test content with UTF-8: café ☕"
+            f.write(test_content)
+            temp_file_path = f.name
+        
+        try:
+            file_url = f"file://{temp_file_path}"
+            with open_data_file(file_url, mode='r', encoding='utf-8') as f:
+                content = f.read()
+                assert content == test_content
+        finally:
+            os.unlink(temp_file_path)
+
+    def test_file_url_nonexistent_file(self):
+        """Test that file:// URLs raise appropriate error for nonexistent files."""
+        file_url = "file:///nonexistent/path/to/file.txt"
+        with pytest.raises(FileNotFoundError):
+            with open_data_file(file_url, mode='r') as f:
+                f.read()
+
+    def test_multiple_file_prefixes(self):
+        """Test that multiple file:// prefixes are handled correctly."""
+        with tempfile.NamedTemporaryFile(mode='w', delete=False, suffix='.txt') as f:
+            test_content = "Test content"
+            f.write(test_content)
+            temp_file_path = f.name
+        
+        try:
+            # Even if someone accidentally adds multiple file:// prefixes
+            file_url = f"file://file://{temp_file_path}"
+            with open_data_file(file_url, mode='r') as f:
+                content = f.read()
+                # This should work because we only replace the first occurrence
+                assert content == test_content
+        except FileNotFoundError:
+            # This is expected behavior - only the first file:// should be stripped
+            pass
+        finally:
+            os.unlink(temp_file_path)
+
+
+if __name__ == "__main__":
+    pytest.main([__file__, "-v"])
\ No newline at end of file