Sayyiduna Ubadah bin al-Samit (may Allah be pleased with him) narrates from the Messenger of Allah (peace and blessings be upon him) that he said: "The best shroud is the hullah, and the best sacrificial animal is the horned ram." The hullah is usually two red garments. The hadiths that the Prophet (peace and blessings be upon him) was shrouded in white garments, and that he preferred white, are more authentic.
Hadith Referenceالسنن الكبرى للبيهقي / كتاب الجنائز / 6693