Digital audio is not inherently better or worse than analog. It is just a more efficient container for the signal, and resists degradation over time.
How digital audio works
Digital audio is made from samples, in the same way that a movie is made of many images strung together to show movement. The more samples, the closer to the original audio it will be.
Sample rates and bit depth
- 16-bit digital audio is usually sampled at 44.1 kHz (CD quality) or 48 kHz (DVD quality).
- 24-bit recording supports the same sample rates at studio quality, as well as 96 kHz and higher.
The better the resolution, the closer it will sound to the original audio.
What actually matters
What matters is how the digital signal is turned back into recognizable sound by a DAC (digital-to-analog converter), and the quality of your headphones. All sound is analog when it reaches your ears.