problems connecting to sql express 2005 server, where mdf file go?

Hello, I have correctly installed sql express 2005 onto my company server. I can connect to the sql express 2005 fine within sql management studio express. I can also connect to it the within visual studio 2005 server explorer. I have my database (MDF) on our server. I am trying to run my application within my client computer. I have changed the connection string property to connect to the server:

"Data Source=CTS\SQLEXPRESS;Initial Catalog=UpdateAttributes;Integrated Security=True"

My program will only work if there is a local copy of MDF database located within my application directory. If I remove the local copy, it errors "No process is on the other end of the pipe" Is it possible to have my application without the local copy of the MDF? I thought the idea is to have the MDF on the server. Then my app would not have the MDF copy!?Fixed the problem. Went to the server, changed the sql server 2005 surface area configuration under remote connections from using TCP/IP to TCP/IP and named pipes.