What's the difference if I put css file inside <head> or <body>?
Just to add on to what jdelStrother has mentioned about w3 specs and ARTstudio about browser rendering.
It is recommended because when you have the CSS declared before <body> starts, your styles has actually loaded already. So very quickly users see something appear on their screen (e.g. background colors). If not, users see blank screen for some time before the CSS reaches the user.
Also, if you leave the styles somewhere in the <body>, the browser has to re-render the page (new and old when loading) when the styles declared has been parsed.
The most recent versions of the HTML spec now permits the <style> tag within body elements. https://www.w3.org/TR/html5/dom.html#flow-content
Also the scoped attribute which used to be prerequisite to have a style tag in the body is now obsolete.
This means, that you can use the style tag everywhere you want, the only implications are decreased page performance due to possible reflows/repaints once the browser hits styles further down in the page tree.
Obsolete answer:
The <style> tag isn't allowed within <body> according to the w3 specs. (You can, of course, apply inline styles via <div style="color:red"> if necessary, but it's generally considered poor separation of style & content)