diff --git a/qiskit_ibm_runtime/fake_provider/local_service.py b/qiskit_ibm_runtime/fake_provider/local_service.py
index d8ba49724..350c622c3 100644
--- a/qiskit_ibm_runtime/fake_provider/local_service.py
+++ b/qiskit_ibm_runtime/fake_provider/local_service.py
@@ -14,6 +14,7 @@
 
 from __future__ import annotations
 
+import math
 import copy
 import logging
 import warnings
@@ -326,6 +327,8 @@ def _run_backend_primitive_v2(
                 prim_options["default_shots"] = default_shots
             primitive_inst = BackendSamplerV2(backend=backend, options=prim_options)
         else:
+            if default_shots := options_copy.pop("default_shots", None):
+                inputs["precision"] = 1 / math.sqrt(default_shots)
             if default_precision := options_copy.pop("default_precision", None):
                 prim_options["default_precision"] = default_precision
             primitive_inst = BackendEstimatorV2(backend=backend, options=prim_options)
diff --git a/release-notes/unreleased/1773.feat.rst b/release-notes/unreleased/1773.feat.rst
new file mode 100644
index 000000000..258ff0b6b
--- /dev/null
+++ b/release-notes/unreleased/1773.feat.rst
@@ -0,0 +1,2 @@
+``default_shots`` are now a supported option when using ``EstimatorV2`` in 
+local testing mode.
\ No newline at end of file
diff --git a/test/unit/test_local_mode.py b/test/unit/test_local_mode.py
index a3302f4bf..d0736eaa5 100644
--- a/test/unit/test_local_mode.py
+++ b/test/unit/test_local_mode.py
@@ -173,7 +173,7 @@ def test_v2_sampler_with_accepted_options(self, backend):
 
     @data(FakeManila(), FakeManilaV2(), AerSimulator.from_backend(FakeManila()))
     def test_v2_estimator_with_accepted_options(self, backend):
-        """Test V1 estimator with accepted options."""
+        """Test V2 estimator with accepted options."""
         options = {"default_precision": 0.03125, "simulator": {"seed_simulator": 42}}
         inst = EstimatorV2(backend=backend, options=options)
         job = inst.run(**get_primitive_inputs(inst, backend=backend))
@@ -181,6 +181,15 @@ def test_v2_estimator_with_accepted_options(self, backend):
         self.assertDictEqual(pub_result.metadata, {"target_precision": 0.03125})
         self.assertEqual(pub_result.data.evs[0], 0.056640625)
 
+    @data(FakeManila(), FakeManilaV2(), AerSimulator.from_backend(FakeManila()))
+    def test_v2_estimator_with_default_shots_option(self, backend):
+        """Test V2 estimator with default shots converted to precision."""
+        options = {"default_shots": 100}
+        inst = EstimatorV2(backend=backend, options=options)
+        job = inst.run(**get_primitive_inputs(inst, backend=backend))
+        pub_result = job.result()[0]
+        self.assertDictEqual(pub_result.metadata, {"target_precision": 0.1})
+
     @combine(
         primitive=[SamplerV2, EstimatorV2], backend=[FakeManila(), FakeManilaV2(), AerSimulator()]
     )