Provided are a method, system, and program for installing and executing shared applications in shared folders. A program is installed by a base computer, having a local storage, to a shared folder accessible to multiple client computers over a network. Installing the program adds files for the program to the shared folder and modifies the local device used by the base computer and enables the base computer to run the program by accessing the program files in the shared folder. An image is created of the local device of the base computer including the installed program. The image is provided to the client computers to apply to local devices of the client computers. Applying the image to the local devices of the client computers enables the client computers to access the program files in the shared folder to run the program.