The AM2302 is a wired version of the DHT22, in a large plastic body. It is a basic, low-cost digital temperature and humidity sensor. It uses a capacitive humidity sensor and a thermistor to measure the surrounding air, and spits out a digital signal on the data pin (no analog input pins needed). Its fairly simple to use, but requires careful timing to grab data. The only real downside of this sensor is you can only get new data from it once every 2 seconds, so when using Adafruit's library, sensor readings can be up to 2 seconds old.
Simply connect the red 3-5V power, the yellow wire to your data input pin and the black wire to ground. Although it uses a single-wire to send data it is not Dallas One Wire compatible! If you want multiple sensors, each one must have its own data pin! They have written an Arduino library with example code
Compared to the DHT11, this sensor is more precise, more accurate and works in a bigger range of temperature/humidity, but its larger and more expensive
There is a 5.1K resistor inside the sensor connecting VCC and DATA so you do not need any additional pullup resistors
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