Hibernate Annotations is my preferred way to map my entity classes, since they don't require any external file (thus keeping mapping info in your Java files), is fully integrated with all Hibernate mapping capabilities and Hibernate documentation encourages us to use this kind of configuration because it's more efficient.
Annotation driven mapping in Hibernate uses the standard JPA API annotations and introduce some specific extensions to deal with some Hibernate features. You can find a full reference in the official documentation.