For Ds's second birthday we had a party at the little gym. We had his first b-day there as well. We invited his cousins, and my friends two kids. For his second B-day Dh and I gave him a trike because Dh got a bicycle for his B-day and now they can ride together. This year however we are giving him a party at home. Dh doesn't want to spend a bunch of money on the little gym again. So we are having a truck party. The kids will play outside, and we will barbeque. I am also getting these little plastic flower pots that the kids can color, and some dirt and beans so they can all plant bean stalks. I always make Ds's cake myself, his first was a train, last year I made three small cakes, Elmo, Cookie Monster and Telly. This year I am making cupcakes with little trucks on top. I am asking that the guests not bring him a bunch of toys. I know it sounds a little weird, but since we only invite family we get to fill them in on what Ds wants. This year we are requesting money to put towards a gymnastics class for Ds. He really wants one, and they are a little out of our price range.
For a two year old you want to think about the same things as with a one year old. You want to work around her sleeping scheduel, and not plan anything too big. Maybe some family and close friends at the park or somewhere else she really likes. I wouldn't go crazy and have a clown or magician or anything because it would probably just scare her. A word of caution though, if you have the party at your house be ready to spend a lot of time cleaning up. I know alot of moms just opt for Chuckie Cheese or something similar. Don't feel bad for not wanting to host a party at your house though, I do have to say that even though it was expensive, the little gym parties were a blast for the kids and the adults, and all I had to do was provide the cake and party favors.