Bismillah al-Rahman al-Raheem
The Science of Hadith
It is the category of Hadith where its extractor, i.e. collector, is recognized and its narrators are celebrated. Most of the Ahadith revolve around this category and are accepted by most of the scholars and by and large used by the Fuqaha’. This means that its Isnad is free from any narrators who may have been accused of lying, and that it is not regarded as an odd (Shath) Hadith.Al-Hadith al-Hasan is two types:
1- The Hadith where the men of its Isnad are not free from an anonymous narrator whose competency is not documented, but who is neither apathetic nor susceptible to making many mistakes nor accused of dishonesty. A similar text i.e. Matn of the Hadith could have been narrated via another route, thus excluding it from being odd i.e. Shath or denounced i.e. Munkar.
2- The narrator must be renowned for his sincerity and honesty even though he has not achieved the standard of the Sahih narrators in terms of memorisation and accuracy. Also, what he narrates exclusively in terms of reports must not be deemed as Munkarand the Matn must not be Shath or Mu'allal i.e. defective.
Hence, al-Hadith al-Hasan is narrated by an honest narrator with a retentive faculty which may not be that strong, but the text i.e. Sanad of which is uninterrupted and not Shath or Mu’allal. Al-Hadith al-Hasan is therefore an authority and can be used as evidence just like the Sahih Hadith.
Source: Islamic Personality Volume I (Hizb ut-Tahrir)