That is the most common location, but you can experiment. Usually people put compressors before distortion so that it will drive the input for a longer time.

Keep some things in mind. A compressor will BOTH increase the volume of the input signal AND limit it. That’s why it’s called a “compressor”. It smooths out – compresses – the volume from the beginning of the note, the attack, to the end of the note, the release. A LIMITER only limits the volume, it doesn’t boost it.

So, a compressor can actually ADD NOISE, by boosting the noise if you have it set too high. Also, if you have the compressor before an effect that depends on volume like an envelope filter – Doctor Q, Bassballs, etc. – it will make that effect less sensitive.

Depending on your setup, it might actually make sense to have a compressor at the beginning or your effects chain and another, or a limiter, at the end of your effects chain. This is essentially what happens when you go into a mixing board anyway. The sound tech will usually apply some sort of limiting or compression to each channel to control spikes and get more control over blending all of the channels. Then, they might apply compression again (!) to smooth out the entire mix.

If you only have a single compressor, like MOST of us, start by putting it at the beginning of your effects chain, but don’t be afraid to move it around after you’ve gotten used to how it works.

I have LOTS of pedals on my board. My pedal order is Guitar -> Hum Debugger (Noise Canceller) -> Silencer (Noise Gate) -> Attack Decay Tape Reverse Simulator -> Knockout (Tone Shaper) -> Tone Corsete (Compressor) -> Everything else. I could move my compressor in front of my Knockout, but the Attack Decay depends on the input volume to trigger the Attack Decay cycle to that could mess it up, and the Attack Decay has a built-in compressor after its input to give the envelope more of a signal to work with on long decay settings.