You can place it almost anywhere, but the best location is in between the Power Co Can and your panel. In my case the power was on one side of the house and gas line was on the other. I was going to have to run one to the other side and it's a lot cheaper and easier to run the electric cables. I put the ATS next to my meter can and then ran the new incoming wires into the panel which was in a closet juts behind the meter. The line ran all the way across the attic to the generator on the other side of the house.

Hi hello Tom Pipps !

The ATS does not allow back-feeding either way by design. There is a mechanical solenoid that isolates the generator power from the utility mains. Same thing in reverse. When the ATS senses strong grid power, the generator circuit gets isolated via the same solenoid (switch) in the ATS as it reconnects back to the utility. Most ATS also have a manual switch feature, should the solenoid fail.