Hills are tactically important positions, overlooking the entire battlefield and giving war machines and missile-armed troops an excellent opportunity to shoot at the enemy. Many battles have been won or lost depending on a General's ability to exploit the tactical use of hills.
Units on a hill can draw a line of sight from an elevated position and they can always shoot (and be shot at) over models that are not on a hill, in the same way as described for large targets. This means that models in the rear ranks of units on the flat may shoot against models standing on a hill.
When other pieces of terrain, such as woods, buildings or other hills block the line of sight of a unit on a hill, you should get down over the table and take a model's eye view to determine what the models on the hill can see. Therefore, most of the time your troops may be able to see over low obstacles that are on the ground below. It is difficult to give more precise guidelines about this matter as the terrain pieces in people's scenery collection vary greatly in size and shape. It is normally a good idea to discuss with your opponent how you are going to treat line of sight before starting the game.