[hardwired]

Declaring x_pos and y_pos as local variables in paint hid the member variables of the same name. Solution: eliminate the declarations in paint.
In java:

Code:

public void paint(Graphics g) {
    // Change these - declaration/instantiations of local variables
    int x_pos=e.getX();  // These hide the member variables
    int y_pos=e.getY();  // declared above in class scope.
    // to these - instantiations of member variables
    x_pos=e.getX();
    y_pos=e.getY();

Code:

//  <applet code="CatcherRx" width="300" height="300"></applet>
import java.awt.*;
import java.awt.event.*;
import java.applet.*;

public class CatcherRx extends Applet implements MouseMotionListener{
    int x_pos;
    int y_pos;

    public void init(){
        addMouseMotionListener(this);
    }

    public void mouseMoved(MouseEvent e){
        x_pos=e.getX();
        y_pos=e.getY();
        repaint();
    }

    public void paint(Graphics g){
        g.setColor(Color.blue);
        g.fillRect(x_pos-25,y_pos-5,50,10);
    }

    public void mouseDragged(MouseEvent e) {}
}