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SharePoint 2013 Not installed

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Hi,

I have just downloaded and Installed Visual Studio 2012 for creating webservice on my Online Sharepoint 2013 Office 365.

But when i try to create new project as SharePoint 2013 - Empty project in C#. I gives out error as shown below.

 "SharePoint not installed. The required version of sharepoint foundation 2013 or sharepoint server 2013 is not installed on this system.To develop sharepoint solutions or browse sharepoint connections in server explorer, SharePoint must be installed on the local system. Make sure that the local server referenced by the sharepoint project exists."

So my question is do we need to install SharePoint 2013 server on local machine for creating projects inVisual Studio 2012 and upload on SharePoint 2013 Online Office 365.??

My current Enviornment: 1. Visual Studio 2012

2. Sharepoint Designer 2013

3. SharePoint 2013 Online Office 365.  


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