diff --git a/cmd/crossplane/render/contextfn/listener.go b/cmd/crossplane/render/contextfn/listener.go
index cf8ef6d2..f43a8107 100644
--- a/cmd/crossplane/render/contextfn/listener.go
+++ b/cmd/crossplane/render/contextfn/listener.go
@@ -19,9 +19,8 @@ package contextfn
 import (
 	"context"
 	"encoding/json"
+	"fmt"
 	"net"
-	"os"
-	"path/filepath"
 	"sync"
 	"time"
 
@@ -37,16 +36,10 @@ import (
 
 // Handle is the owner of a running in-process context function.
 type Handle struct {
-	// Target is the gRPC target that dials the function. Set this as the
-	// FunctionInput address passed to the render engine.
-	Target string
-
+	target       string
 	srv          *grpc.Server
 	fn           *server
-	socketPath   string
-	dir          string
 	stop         sync.Once
-	log          logging.Logger
 	seedInput    *runtime.RawExtension
 	captureInput *runtime.RawExtension
 }
@@ -58,9 +51,8 @@ func (h *Handle) Captured() *structpb.Struct {
 }
 
 // Start starts an in-process gRPC server that implements the composition
-// function RunFunction RPC for context seeding and capture. The server
-// listens on a unix-domain socket inside a fresh temp directory. Callers
-// must call Handle.Stop when done.
+// function RunFunction RPC for context seeding and capture. Callers must call
+// Handle.Stop when done.
 func Start(ctx context.Context, log logging.Logger, contextData map[string]any) (*Handle, error) {
 	si, err := json.Marshal(input{Mode: modeSeed})
 	if err != nil {
@@ -71,51 +63,24 @@ func Start(ctx context.Context, log logging.Logger, contextData map[string]any)
 		return nil, errors.Wrap(err, "cannot create capture context function input")
 	}
 
-	dir, err := os.MkdirTemp("", "render-ctx-*")
-	if err != nil {
-		return nil, errors.Wrap(err, "cannot create temp dir for context function socket")
-	}
-
-	cleanup := func() {
-		_ = os.RemoveAll(dir)
-	}
-
-	sockPath := filepath.Join(dir, "s")
 	var lc net.ListenConfig
-	lis, err := lc.Listen(ctx, "unix", sockPath)
+	lis, err := lc.Listen(ctx, "tcp", ":0")
 	if err != nil {
-		cleanup()
-		return nil, errors.Wrapf(err, "cannot listen on %q", sockPath)
-	}
-
-	cleanup = func() {
-		_ = lis.Close()
-		_ = os.RemoveAll(dir)
-	}
-
-	// In order for processes in Docker containers to connect to the socket, the
-	// socket must be world-writeable and its containing directory must be
-	// world-readable.
-	if err := os.Chmod(dir, 0o755); err != nil { //nolint:gosec // Necessary.
-		cleanup()
-		return nil, errors.Wrapf(err, "cannot make socket directory world-readable")
-	}
-	if err := os.Chmod(sockPath, 0o777); err != nil { //nolint:gosec // Necessary.
-		cleanup()
-		return nil, errors.Wrapf(err, "cannot make socket file writeable")
+		return nil, errors.Wrap(err, "cannot create listener for context function")
 	}
 
 	srv := grpc.NewServer(grpc.Creds(insecure.NewCredentials()))
 	fn := newServer(contextData)
 	fnv1.RegisterFunctionRunnerServiceServer(srv, fn)
 
+	addr := lis.Addr().(*net.TCPAddr) //nolint:forcetypeassert // We specified "tcp" above.
+
 	h := &Handle{
-		Target:       "unix://" + sockPath,
+		// Report the target as 127.0.0.1:PORT since the render machinery knows
+		// how to handle functions listening on loopback.
+		target:       fmt.Sprintf("127.0.0.1:%d", addr.Port),
 		srv:          srv,
 		fn:           fn,
-		socketPath:   sockPath,
-		dir:          dir,
-		log:          log,
 		seedInput:    &runtime.RawExtension{Raw: si},
 		captureInput: &runtime.RawExtension{Raw: ci},
 	}
@@ -129,8 +94,8 @@ func Start(ctx context.Context, log logging.Logger, contextData map[string]any)
 	return h, nil
 }
 
-// Stop gracefully stops the function server and removes the socket directory.
-// Safe to call multiple times.
+// Stop gracefully stops the function server, which closes its listener. Safe to
+// call multiple times.
 func (h *Handle) Stop() {
 	h.stop.Do(func() {
 		done := make(chan struct{})
@@ -143,8 +108,5 @@ func (h *Handle) Stop() {
 		case <-time.After(5 * time.Second):
 			h.srv.Stop()
 		}
-		if err := os.RemoveAll(h.dir); err != nil {
-			h.log.Debug("Cannot remove context function socket directory", "dir", h.dir, "error", err)
-		}
 	})
 }
diff --git a/cmd/crossplane/render/contextfn/listener_test.go b/cmd/crossplane/render/contextfn/listener_test.go
index b09fb002..d200cf70 100644
--- a/cmd/crossplane/render/contextfn/listener_test.go
+++ b/cmd/crossplane/render/contextfn/listener_test.go
@@ -18,7 +18,6 @@ package contextfn
 
 import (
 	"context"
-	"os"
 	"testing"
 	"time"
 
@@ -42,7 +41,7 @@ func TestListenerRoundTrip(t *testing.T) {
 	}
 	defer h.Stop()
 
-	conn, err := grpc.NewClient(h.Target, grpc.WithTransportCredentials(insecure.NewCredentials()))
+	conn, err := grpc.NewClient(h.target, grpc.WithTransportCredentials(insecure.NewCredentials()))
 	if err != nil {
 		t.Fatalf("grpc.NewClient: %v", err)
 	}
@@ -61,26 +60,3 @@ func TestListenerRoundTrip(t *testing.T) {
 		t.Errorf("context (-want +got):\n%s", diff)
 	}
 }
-
-func TestStopRemovesSocket(t *testing.T) {
-	ctx, cancel := context.WithTimeout(context.Background(), 5*time.Second)
-	defer cancel()
-
-	h, err := Start(ctx, logging.NewNopLogger(), nil)
-	if err != nil {
-		t.Fatalf("start: %v", err)
-	}
-
-	if _, err := os.Stat(h.socketPath); err != nil {
-		t.Fatalf("socket should exist: %v", err)
-	}
-
-	h.Stop()
-
-	if _, err := os.Stat(h.socketPath); !os.IsNotExist(err) {
-		t.Errorf("socket should not exist after Stop, got err=%v", err)
-	}
-
-	// Second Stop is a no-op.
-	h.Stop()
-}
diff --git a/cmd/crossplane/render/contextfn/wire.go b/cmd/crossplane/render/contextfn/wire.go
index 21dc90bd..2fb5601e 100644
--- a/cmd/crossplane/render/contextfn/wire.go
+++ b/cmd/crossplane/render/contextfn/wire.go
@@ -27,8 +27,9 @@ import (
 // Mirror the render package's runtime-selection annotations. Duplicated here
 // rather than importing cmd/crank/render to avoid an import cycle.
 const (
-	annotationKeyRuntime            = "render.crossplane.io/runtime"
-	annotationValueRuntimeInProcess = "InProcess"
+	annotationKeyRuntime                  = "render.crossplane.io/runtime"
+	annotationValueRuntimeDevelopment     = "Development"
+	annotationKeyRuntimeDevelopmentTarget = "render.crossplane.io/runtime-development-target"
 )
 
 // Function returns the Function definition the caller must add to the
@@ -37,8 +38,11 @@ const (
 func (h *Handle) Function() pkgv1.Function {
 	return pkgv1.Function{
 		ObjectMeta: metav1.ObjectMeta{
-			Name:        FunctionName,
-			Annotations: map[string]string{annotationKeyRuntime: annotationValueRuntimeInProcess},
+			Name: FunctionName,
+			Annotations: map[string]string{
+				annotationKeyRuntime:                  annotationValueRuntimeDevelopment,
+				annotationKeyRuntimeDevelopmentTarget: h.target,
+			},
 		},
 	}
 }
diff --git a/cmd/crossplane/render/engine_docker.go b/cmd/crossplane/render/engine_docker.go
index c73bdf26..9beb3e8c 100644
--- a/cmd/crossplane/render/engine_docker.go
+++ b/cmd/crossplane/render/engine_docker.go
@@ -19,7 +19,6 @@ package render
 import (
 	"context"
 	"os"
-	"path/filepath"
 	"runtime"
 	"strings"
 
@@ -146,17 +145,6 @@ func (e *dockerRenderEngine) Render(ctx context.Context, req *renderv1alpha1.Ren
 		opts = append(opts, docker.RunWithNetworkName(e.network))
 	}
 
-	// Bind-mount the directory of every unix-socket function target into the
-	// render container at the same path so unix:// targets are reachable.
-	for _, fn := range getFunctionInputs(req) {
-		addr := fn.GetAddress()
-		if !strings.HasPrefix(addr, "unix://") {
-			continue
-		}
-		dir := filepath.Dir(strings.TrimPrefix(addr, "unix://"))
-		opts = append(opts, docker.RunWithBindMount(dir, dir))
-	}
-
 	e.log.Debug("Running crossplane internal render in Docker", "image", e.image, "network", e.network)
 
 	runner := e.runner
@@ -186,16 +174,3 @@ func (e *dockerRenderEngine) Render(ctx context.Context, req *renderv1alpha1.Ren
 
 	return rsp, nil
 }
-
-// getFunctionInputs returns the FunctionInput list regardless of which oneof
-// variant the RenderRequest carries.
-func getFunctionInputs(req *renderv1alpha1.RenderRequest) []*renderv1alpha1.FunctionInput {
-	switch in := req.GetInput().(type) {
-	case *renderv1alpha1.RenderRequest_Composite:
-		return in.Composite.GetFunctions()
-	case *renderv1alpha1.RenderRequest_Operation:
-		return in.Operation.GetFunctions()
-	default:
-		return nil
-	}
-}
diff --git a/cmd/crossplane/render/op/cmd.go b/cmd/crossplane/render/op/cmd.go
index d6dec277..7b2ae912 100644
--- a/cmd/crossplane/render/op/cmd.go
+++ b/cmd/crossplane/render/op/cmd.go
@@ -219,15 +219,10 @@ func (c *Cmd) Run(k *kong.Context, log logging.Logger, sp terminal.SpinnerPrinte
 	}
 	defer render.StopFunctionRuntimes(log, fnAddrs)
 
-	addrs := fnAddrs.Addresses()
-	if ctxHandle != nil {
-		addrs[contextfn.FunctionName] = ctxHandle.Target
-	}
-
 	// Build and execute the render request.
 	in := render.OperationInputs{
 		Operation:           op,
-		FunctionAddrs:       addrs,
+		FunctionAddrs:       fnAddrs.Addresses(),
 		RequiredResources:   rrs,
 		RequiredSchemas:     rsc,
 		FunctionCredentials: fcreds,
diff --git a/cmd/crossplane/render/xr/cmd.go b/cmd/crossplane/render/xr/cmd.go
index a7902230..f1e610cc 100644
--- a/cmd/crossplane/render/xr/cmd.go
+++ b/cmd/crossplane/render/xr/cmd.go
@@ -278,16 +278,11 @@ func (c *Cmd) Run(k *kong.Context, log logging.Logger, sp terminal.SpinnerPrinte
 	}
 	defer render.StopFunctionRuntimes(log, fnAddrs)
 
-	addrs := fnAddrs.Addresses()
-	if ctxHandle != nil {
-		addrs[contextfn.FunctionName] = ctxHandle.Target
-	}
-
 	// Build and execute the render request.
 	in := render.CompositionInputs{
 		CompositeResource:   xr,
 		Composition:         comp,
-		FunctionAddrs:       addrs,
+		FunctionAddrs:       fnAddrs.Addresses(),
 		ObservedResources:   ors,
 		RequiredResources:   rrs,
 		RequiredSchemas:     rsc,