Hibernate projects are licensed under either the LGPL 2.1 or the ASL 2.0. Hibernate is Free Software.
You can find under which a specific project is released below its menu or in the code source.
Most Hibernate projects are released under the LGPL v2.1.
The LGPL is sufficiently flexible to allow the use of Hibernate in both open source and commercial projects. The LGPL guarantees that Hibernate and any modifications made to Hibernate will stay open source, protecting our and your work. Anyone who wanted to release Hibernate under a different license would have to obtain permission from hundreds of people who have contributed code to Hibernate, which would be impractical. Hibernate is and will be open source.
The use of the unmodified Hibernate binary of course never affects the license of your application or distribution. You will never have to pay money to any commercial entity for using or integrating Hibernate.
If you modify Hibernate and redistribute your modifications, the LGPL applies. Please submit any modifications to our issue tracking system for review and possible inclusion in the upstream Hibernate project(s).
Some Hibernate projects are released under the more permissive ASL 2.0.
This is mostly due to our work with the Java Community Process. Implementing a reference implementation in practice requires such liberal license (or a fully proprietary one strangely enough).
Every now and then we do evaluate the option to start or relicense certain projects under liberal licenses like the ASL but our DNA is with the LGPL. So the reasons have to be solid.