The game is broken into levels, which are accessed from the cantina each film is represented by six levels, representing key locations and scenes in that film. In a small area outside the cantina, players may view collected vehicles. At the counter, the player may use their Lego studs to purchase characters, vehicles, gameplay hints and extras, or activate cheat codes. The game's central location is the Mos Eisley cantina, a spaceport bar on the planet Tatooine. You can unlock Slave I if you collect all canisters in the game. There are also levels where you must pilot a ship. Some of the characters have special actions such as slapping or punching enemies, or interacting with friendly characters. Much of the game revolves around collecting 'studs,' small LEGO pieces that are used as an in-game currency. The game holds the Guinness record for most playable characters in an action-adventure video game. The game also includes several new features, including vehicles, character-specific abilities, and customizable characters. It features a total of 114 playable characters, 46 of them unlockable by having a saved game from LEGO Star Wars on the memory card or hard drive (and the others must be bought in the Mos Eisley Cantina, or unlocked during gameplay). Publishing duties were taken up by LucasArts (replacing the original's Eidos Interactive). The game was developed by Traveller's Tales, which was also responsible for the original.

It covers the first three films (episodes IV, V, and VI), unlike LEGO Star Wars, which covers episodes I, II, and III. While the original films were fairly serious, besides a few puns in the later movies, LEGO Star Wars II is much more tongue-in-cheek, with large amounts of bizarre physical humor (there is no voice acting, so all jokes involve slapstick comedy). Luke Skywalker, Princess Leia, Han Solo, Chewbacca, Lando Calrissian, C-3PO, R2-D2, and Wicket in the game's final cutscene. 2.3.2 Chapter 2: The Great Pit of Carkoon.2.1.2 Chapter 2: Through the Jundland Wastes.

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