The integration of open data and artificial intelligence (AI) offers significant potential for advancing sustainable development goals in local governance. The Doughnut Economy framework, emphasizing human well-being within ecological limits, provides a valuable guide for promoting sustainable and equitable policies. AI can support this vision by analysing diverse datasets to enhance decision-making, boost sustainable resource allocation, and support inclusive policies. AI-powered tools have the potential to transform local governance by improving efficiency, reducing costs, and fostering transparency and accountability. They enable local governments to address complex challenges and implement data-driven policies at scale. However, this increasing reliance on AI and open data also introduces substantial cybersecurity risks. Open data platforms can become targets for cyberattacks, such as data breaches or manipulation, which may compromise the accuracy of AI-driven insights. Additionally, inadequate anonymization of sensitive information can expose individuals and communities to privacy violations. To address these risks, robust cybersecurity measures are essential. These include ensuring secure data storage, deploying advanced encryption, and implementing AI governance frameworks that prioritize transparency and accountability. Effective risk management strategies are also critical to building public trust and safeguarding the ethical use of AI in decision-making. This study examines how open data and AI can support sustainable local development while emphasizing the importance of addressing cybersecurity challenges to ensure their safe and ethical deployment.