A Sitemap Generator can be either installed on your server, it can be done manually by you, or you can pay a pro service and they will update it continuously.
I have tried numerous methods and this site seems to have the best service out there, with fast customer support:
Here is the difference between using all three methods:
Server Side: You have a cron setup on your server
to crawl your site and create a new file on your site.
Pros:
Its automatic, and once its setup, you don't have to worry about
it.
Cons:
It requires a developer to configure the script (or hosting
company)
There isn't any software out there that is stellar that I would
recommend. Google had software that generated for an entire server,
but it had bugs.
Manual: You can use a free website that can build a sitemap for you in less than a minute.
Pros:
Its free!
It doesn't take very long
If you don't plan on having a site constantly updated, this is an
idea approach (however if you're serious about SEO traffic, you'll
need to update your site constantly).
Cons:
Its limited
Its manual work. So you have to download the sitemap file, upload
it to your server, and re-ping Google Webmaster Tools to check the
new sitemap.
Paid Pro Version: This is the ideal method for people who just don't want to worry about it and they want a piece of mind the site is constantly updated and indexed in Google. This is an absolute must for content generated sites and e-commerce sites. If you plan on blogging, it helps, although you can also find some good plugins to install through your CMS without paying for anything.
Pros:
Automatic once its setup, which can be done by anyone.
Compiles sitemaps for XML, News, Images, and Videos. Google likes
these types of sitemaps.
Sends you an email alert when it discovered more links to
modify.
Cons:
Its a recurring subscription amount.
You're putting your sitemap on a websites Google Webmaster Tools
account. I've done this with numerous sites and haven't had any
problems yet, and there are no red flags by Google from this
approach, they even have a list:
Google Sitemap List