C++: Namespaces -- How to use in header and source files correctly?

Consider a pair of two source files: an interface declaration file (*.h or *.hpp) and its implementation file (*.cpp).

Let the *.h file be like the following:

namespace MyNamespace {
  class MyClass {
  public:
    int foo();
  };
}

I have seen two different practices for using namespaces in source files:

*.cpp showing practice #1:

#include "MyClass.h"
using namespace MyNamespace;

int MyClass::foo() { ... }

*.cpp showing practice #2:

#include "MyClass.h"
namespace MyNamespace {

  int MyClass::foo() { ... }

}

My question: Are there any differences between these two practices and is one considered better than the other?

From a code readability standpoint, it is probably better in my opinion to use the #2 method for this reason:

You can be using multiple namespaces at a time, and any object or function written below that line can belong to any of those namespaces (barring naming conflicts). Wrapping the whole file in a namespace block is more explicit, and allows you to declare new functions and variables that belong to that namespace within the .cpp file as well

The clearest is the option you didn't show:

int MyNamespace::MyClass::foo()
{
    //  ...
}

It's also very verbose; too much so for most people. Since using namespace is a recepe for name conflicts, at least in my experience, and should be avoided except in very limited scopes and places, I generally use your #2.