Abstract. Let k be a field of characteristic zero, K an algebraic function field over k, and V a k-valuation ring of K. Zariski's theorem of local uniformization shows that there exist algebraic regular local rings R i with quotient field K which are dominated by V , and such that the direct limit ∪R i = V.We investigate the ring T = ∪R i . The ring T is Henselian and thus can be considered to be a "completion" of the valuation ring V . We give an example showing that T is in general not a valuation ring. Making use of a result of Heinzer and Sally, we give necessary and sufficient conditions for T to be a valuation ring.The essential obstruction to T being a valuation ring is the problem of the rank of the valuation increasing upon extending the valuation dominating a particular R to a valuation dominating its completion. In the case of rank 1 valuations, we show that this problem can be handled in a very satisfactory way.Finally, suppose that K * is a finite algebraic extension of K and V * is a rank 1 k-valuation ring of K * such that V = V * ∩ K. We obtain a relative local uniformization theorem for the extension K * of K, that generalizes previous results of Cutkosky and Piltant.