The biometric reader is built into the phone's rear panel, as is a small touchpad for unlocking the device. An interesting idea in theory but how it will work in practice is anyone's guess.
Mobile application developers need to know that the hardware they rely upon will be there. It's looking more and more likely that, following a false start in 2011, there will be a fingerprint capability in the Android environment. Hopefully it's here to stay this time.
See:
Mobile Handset Review: Motorola Atrix 4G (The One with a Fingerprint Reader) - Monday, October 31, 2011
Disappointment followed two days later...
Motorola Atrix 2 Has No Fingerprint Reader - Wednesday, November 2, 2011