Right click the java module item in the project view, the popup menu shows, and click the “Module Settings ...”, then select “Library (Classpath)” tab, then click “Jar/Dir...” button. But you can only add jar files, but not add a dir which contains jar files.

From the hibernate/lib/Readme, you can see the description of each library, and whether it is optional or required.

In IDEA 4, you can create the hbm.xml and hibernate.properties in the src dir, and idea will automatically copy them to the classes dir after building.