A proximity transceiver was a component of a Borg drone's cranial implant. Its function was analogous to a beacon that alerted the Collective of the drone's presence.
In 2375, Seven of Nine's proximity transceiver activated in response to a 29th century drone, One, created from the merging of her nanoprobes and The Doctor's mobile emitter. One also possessed a proximity transceiver, and though Seven deactivated it; his systems adapted and created a back-up, attracting a Borg sphere to USS Voyager. (VOY: "Drone")