Hibernate is an object-relational mapping tool that allows Java objects to be persisted to a relational database. It provides transparent persistence by handling all database operations like insert, update, delete, and retrieval. Hibernate sits between the Java application and database, mapping objects to database tables and allowing developers to work with objects rather than directly with SQL statements. Configuration files define the mappings between Java classes and database tables. Hibernate uses these mappings to automatically generate SQL to load and store objects.