We have developed a compact joint transform correlator (JTC) by using the parallel aligned nematic liquid crystal spatial light modulator (PAL-SLM) as a real time hologram device, and have applied the correlator to fingerprint identification. The identification performance was evaluated using 2400 data from 600 fellow workers. The test results showed that the false-reject rate was 0.2% with 0.20/0 false acceptance. The response time of the system was less than 0.1 seconds as a result of parallel processing in the optical system.