Vertically ordered hexagonal boron nitride (h-BN) films were successfully sputtered on AlGaN/GaN heterostructure (HS) using high power impulse magnetron sputtering at room temperature. The h-BNs vertical ordering along the (0002) plane was confirmed using high-resolution transmission electron microscopy. After the h-BN deposition, degradation of two-dimensional electron gas (2DEG) properties was observed in AlGaN/GaN HS. Full recovery of 2DEG mobility, along with an improvement in sheet resistance and an increase in sheet carrier concentration was obtained after rapid thermal annealing at 500 °C for 300 s in a N2 atmosphere, which is due to the reduction of sputtering related structural damage.