This can vary by the type of ATS and depends on the number of circuits you would like covered.
In a partial home application, the ATS is installed similarly to a subpanel or manual changeover, and the circuits that are covered by the generator are moved either into a circuited ATS, or are installed in a subpanel that is protected by a non-circuited ATS.
In a whole home application, the ATS is installed between the incoming utility power source and the home’s distribution panel.