A new technique for optical correlation using gated holographic recording is demonstrated. Several persistent holograms are localized within separate slices as close as 33 microm apart along the crystal. Individual holograms can be dynamically erased and rerecorded with no need to refresh all other recorded holograms. Experimental results showing the correlation capability, cross talk, shift invariance, and dynamicity of the localized holographic correlator demonstrate unique performance and capabilities for these correlators.